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Rejection & Failure - My New Startup MyVilla is on life support
Dealing with the sting of rejection from a failed startup.
About 4 months ago, Chris and I launched MyVilla, a startup that aimed to make vacation home ownership easier and more affordable for a greater number of Americans. One of the requirements to grow and scale the company was that we could secure debt financing from banks or financial partners that would allow us to continue purchasing more homes and offer financing to our customers.
For months, Chris and I have been dancing for dollars, trying to convince any bank or financial partner to provide us capital so that we could begin acquiring houses. Our financial modeling called for 10 houses this year which would require about $20,000,000. We had countless meetings with potential financial partners and they all started off the same way…
The banks would basically say: “We love the idea and you have a great pitch and financial modeling. This is infinitely financeable because you are offering a personal guarantee and it’s secured by very valuable properties.”
However, the excitement from these first meetings would soon fade. After weeks of providing extensive documentation, we'd either receive a flat "NO" or be ghosted. It was brutal.
It left me with a mixture of emotions. From sadness, to anger, to self-doubt, and guilt. But what I just realized a few days ago was that I was experiencing something I hadn’t encountered in a while: Rejection. It stings.
It’s tempting to blame external factors like the banking crisis, interest rates hitting the highest they have been in decades, and a potential implosion of the commercial office real estate market.
But I’m the founder and CEO. It doesn’t matter what is going on with factors that are outside of my control. The responsibility lands squarely on my shoulders and I accept that responsibility.
I’m constantly questioning myself with unanswerable questions:
Did I pitch it wrong?
Should I have pivoted and found a way to scale the company without banks?
Should I wait it out until the banking crisis hopefully resolves itself in a year?
Should I talk to a hundred more bankers?
Am I a quitter and giving up too soon?
Do all startups experience this many headwinds and I’m throwing in the towel too soon?
Startup founders are told tons of conflicting advice. We are told: “never give up”. But we are also told, "fail fast”.
We are given examples of Jeff Bezos persistence in pitching and hearing NO from 60 different investors before he finally heard a YES that allowed him to start Amazon. Then we are told of the famous pivot where a podcasting company Odeo pivoted and became Twitter.
I’m never sure of which advice to follow. Should I keep going and throw good money after bad? Should I pivot or fail fast?
I don’t know and I may never know.
The future of MyVilla is uncertain but if it fails I will have lost a decent amount of my own money but what is much more troubling to me is that I will have lost one of my best friends some of his hard earned money. That makes me feel terrible.
Of course, Chris has been a mensch about it and his wife Laura has been incredibly understanding. But the bitter feeling of losing a friends money is just awful.
At first I thought my sadness was because of the failure of the business, but I quickly realized it was the uncomfortable feeling of knowing that I let down the people that believed in me. (Of course they would all say I didn’t let them down because they are amazing people. But the feeling is still there.)
Yes, I know that failure is a risk in any new venture. My rational brain can tell myself that - “without risk, there is no reward”. I can reassure myself that this isn’t a failure - it’s just an investment and I gained a lot of knowledge from it. These things are all true.
But this is the difference between reading business books and listening to podcasts about business versus actually starting a business. It’s one thing to read it and know it intellectually in your head. It’s something completely different to feel the stinging pain in the pit of your stomach and the bitter taste on the back of your tongue.
But on a brighter note, last night when I was walking out of Lane’s room after his bedtime book, I saw the picture that hangs on his wall and I stopped to read it again. It’s Teddy Roosevelt’s “Man in the Arena.” It was exactly what I needed to read at that very moment.
Theodore Roosevelt's "The Man in the Arena”
“It is not the critic who counts; not the man who points out how the strong man stumbles, or where the doer of deeds could have done them better. The credit belongs to the man who is actually in the arena, whose face is marred by dust and sweat and blood; who strives valiantly; who errs, who comes short again and again, because there is no effort without error and shortcoming; but who does actually strive to do the deeds; who knows great enthusiasms, the great devotions; who spends himself in a worthy cause; who at the best knows in the end the triumph of high achievement, and who at the worst, if he fails, at least fails while daring greatly, so that his place shall never be with those cold and timid souls who neither know victory nor defeat.”
I’m not sure what will happen with MyVilla yet. We may be able to pull a rabbit out of the hat and make this thing work. Or it may be headed for the startup graveyard and I will be holding the shovel. But I am glad that I had the courage with my brother, Chris, to dare greatly, risk our capital and our time, to try to build something that we believe in. And I hope that I can dust myself off and try again in the future…
But give me some time, I’m not quite ready to suit up and try a startup again. The rejection still stings!
I want to provide some actionable advice if you find yourself facing a similar setback.
When I was experiencing these negative feelings, there were proactive ways that I could alleviate some of them. Waking up early, exercising, doing cold & hot exposure, getting lots of sleep, eating a good diet, being mindful and grateful, journaling every night, and avoiding the phone before bed and immediately after waking. These are all lessons I learned during my Year Of The Opposite and I’m so thankful for them. Using these tools, I could meaningfully reduce my negative emotions that came along with a startup failure and the sting of rejection.
As the stoic philosophers say: “The body should be treated more rigorously, that it may not be disobedient to the mind” - Seneca.
Disclaimer: This isn’t a woe-is-me article because I have nothing in this world to complain about. I have been blessed and I recognize that I am extremely lucky. This is just my attempt to be open and honest about the feelings I experienced during a tough setback. I share this not because I think that I am special or unique, but rather because I think my story is common to many people but that these feelings are not openly talked about. I hope that others may read this and realize that they are not alone and that maybe my experience can help them navigate their feelings a little easier.
Thanks to all of you that provided support, encouragement, willingness to invest, and eagerness to be a customer. Your support means a lot to me.