Recently a Founder and CEO I work with reached out because she realized she is running out of money faster than she had planned and will need to raise before she is ready. She felt afraid and unsure of how to handle it. Each option on the table had meaningful drawbacks for the company. Each potential solution could be met with real resistance by the board, employees, the executive team, and new investors. That is the life of the startup CEO. Sometimes there are no good options for a given problem.
At any given moment there are 100 fires for a CEO to fight and time to put out only 2-3. You have to focus on those that matter, and just as importantly inspire the team to do the same. It’s easy to get distracted by less complex, more solvable problems that may be less urgent or less important than the 2-3 that matter most. Those thoughts are common. And dangerous.
What I found to be less commonly talked about is the dynamic that exists when a CEO and team are working on a problem to which there are only bad solutions. By bad solutions I mean those that are easy to poke holes in. If you wait to raise until you have metrics, you are gambling and could easily be left without money. Raise now and you don’t have the metrics to be successful. Raise a bridge round and it signals weakness. Cut burn through layoffs and you kill momentum. Each solution carries its own set of risks and is easy to criticize.
This dynamic was something I experienced several times in my first few years as CEO. Not because the company as a whole was always going through something difficult; often it was a component of the company, or one discrete problem. But it happens, to all companies and all CEOs. It took me several years of occasionally running around in circles on those types of problems to realize the power of simply accepting that there are no good options. In those instances the sub-team assigned to the problem (myself included) would debate endlessly, taking turns to poke logical and data-driven holes in each potential solution. The result was lost weeks (and embarrassingly sometimes months) of spinning wheels rather than making a decision and moving on. The most painful example of this was trying to make our marketplace work before we pivoted. Often at a startup, a decision is better than no decision. The unlock for me with these types of problems was to recognize — and encourage the team to recognize — that there was no perfect solution and that every answer had faults.
For the analytically minded CEO or team, it is exceptionally painful to pick a solution that has meaningful obvious downsides. As a result they discuss the same set of options over and over — sometimes with different detractors taking turns to tear down proposed solutions. Meetings get scheduled. Additional analysis is ordered. Backdoor advocating sometimes occurs. Advisors, investors, and board members are pulled in for advice. All the while time passes and no decision is made. When it eventually comes, that final decision is typically made off of the same information, and using the same solution set, as was originally available. The only difference is that the team lost valuable time and morale.
I found that one of the most helpful tools is to simply acknowledge, out loud, that there are no good options. It’s useful to start by laying out the possible solutions, regardless of perceived merit, in a shared Google Doc, whiteboard or equivalent. You may find it productive to also detail the top 2-3 benefits or drawbacks of each option. When I acknowledged to myself, and to others in the decision-making process, that all our available options had drawbacks and that we could spin wheels indefinitely focusing on the negatives, I found we were collectively more able to make a decision and move on. It’s not a decision-making framework, those are common. It’s more an emotional release for the CEOs and teams that want a perfect answer. There almost never is one, and the old adage rings true: “Don’t let perfect be the enemy of good.”