Bad News is the Best News

The very strongest startup founders have an unnatural attraction to bad news. They will go to great lengths to find it.

Bad news might be a customer defecting to a competitor. Or, an expert says their business plan just won't work.

Strong founders know that bad news is the best way to get better. Good news, on the other hand, just doesn't show you your gaps. Bad news tells you where and how to improve.

I first learned this from a second-time founder. We decided to pass on his investment because of the opinion we learned in talking to a few experts. He (nicely) kept after us until we were able to connect him to those experts. This founder didn't want to change our mind. He just wanted to learn why they thought he was wrong.

I've seen other founders nicely ask VCs who passed on their deal for advice on how to better tell their story or improve their business. Others go find competitor customers and interview them. And so on.

It's hard though. Getting told you're wrong really feels terrible. That's OK. The great founders get over it, learn and move on.

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