How are you parenting your startup?

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The average female African elephant conceives once every 3 to 9 years. During these times, gestation is notoriously long — 22 months, and they generally produce one calf.

The Eastern Cottontail Rabbit, on other hand, has 1-7 litters per year with sizes ranging from one to twelve; yes, that's 84 bunnies yearly. Cuteness runneth over.

Reproduction randomizes, nature selects. And so these species haven't diverged based on their proclivity for the act: each has evolved a strategy that has allowed them to avoid being any of the 99% of species 🐙 no longer walking this planet.

Both strategies — large bets on a few offspring, small bets on many, can work. The elephant, the rabbit, the owl (few), and the sea turtle (many), and thousands of others are evidence.

Yet, this isn't to say these strategies are interchangeable. Elephants reproducing like rabbits would lead to some gorged lions and the extinction of these tusked magistrates. Rabbits reproducing like elephants would mean we could read storybooks about rabbits to our own children — but then they wouldn't be able to go see one. "No, darling. And the owls ... they are very, very hungry."

Survivor: Startups Edition

Like the harsh reality faced by newborn critters, the startup world is tough. While the root causes (incompetence, ignorance, or competition) are debatable, mortality rates are undeniably high.

For this reason, we've invented capital structures, communities, incubators, and accelerators focused on the gestational pre-seed and seed stages. These are a nod towards the low fecundity of the elephant: we can improve our chances if we try!

Counter to this, portfolio-minded investors, and an increasing number of founders, are veering towards the high-fecundity strategy of the field mouse: lets make lots of these and see what works. We birth; the gods decide. Glory to the survivors!

The Goal/s

A startup with product/market-fit is more valuable than "the same startup" without fit. And so it's safe to posit that all of the players in startup land want startups with fit, and want to avoid being tied to ones without.

In this case, the operative question we need to answer when choosing a strategy is: which one gives us the higher likelihood of finding a startup with fit?

Except that's not quite right, is it? Are we trying to find a startup with fit? Or are we trying to get to fit? Investors are the former; founders — aren't they supposed to be the latter?

Uh oh.

Parenting Strategies

The high-fecundity strategy evolved among prey in high-risk environments. Their parenting strategy can be characterized as hands-off. As a human parent, we would call this neglect. The environment will decide. Mostly. Sometimes the parents will decide to extricate their own young from this world to preserve resources for the non-runts. Nature is metal.

If you squint, this does sound like the strategy that fits an investor. In a healthy investor/founder dynamic, they are mostly hands-off. Founders want help, but they crave autonomy (the benefit of "neglect").

Critically, a good investor, the kind great founders want to do deals with (which keeps the investor alive), simply does not have much agency in determining the outcomes of their investments. Therefore, though they possess skill ... from their vantage point, the market environment of which the founder is a part, really does decide.

Founders, on the other hand, do have agency. And they are supposed to have skill. And so if it's not their job to get a startup to a place of fitness, whose job is it? A company with an empty driver's seat is not a good bet, for anyone.

As an investor, a startup with fit may appear in your spreadsheet.

But as founders, we should operate under the assumption that the environment won't hand you fit. Finding fit is a wrestling skill 🐙.

Are founders allowed to be investors? Yes, of course, increasingly so. Many bets makes sense for a founder's portfolio — companies of which they own a part but don't operate. But when founders adopt investor strategies towards the very companies they are supposed to be running, they are more likely to feed market predators and go extinct than become the dominant species.

I want to finish by making exceptions to the trade-offs I've outlined, but I won't. Yes, founders place lots of small bets in order to learn what the market wants, but this is in the context of getting a single company to fit. And so the large bet of building a company is in practice composed of many small bets, sometimes in parallel, mostly sequential, that reduce risk along the way. But at this level of zoom on the fractal, the strategies diverge.

You may be the rabbit.

I choose elephant.