($) What does “I want to start a company” mean?

This simple sentence can be empowering – or it can really trip you up and even embarrass you depending on the context and to whom you are saying it.

If you’re in Silicon Valley and you utter these words, you could get a range of reactions from an eyeroll to a shrug to a look of abject boredom.

If you’re in the Valley and you say that to a VC, then if they’re especially nice they’ll perhaps inquire about your idea or make polite conversation with you. It’s possible that their guard will go up as they get ready for you to pitch them, which is what frequently happens as soon as someone discovers that that’s what they do.

Many MBA admissions people will put anyone uttering the “start a company” sentence into the same bucket: Wanna-be entrepreneur. These applicants are a dime a dozen these days. The schools are certainly much more welcoming of this as a career goal than they were even five or ten years ago and they have significantly more resources and support for entrepreneurs.

But if you get even a step or two further along the path of exploring such goals, you really need to be clued in on what you’re saying and what you mean by claim.

Are you saying you want to start a company as part of your process of earning your MBA? Are you going to put it together and launch during bschool? Will you use school as a quasi-incubator?

Or is it just some far-off thought that you’ve fantasized about, thinking “Someday that’s what I will do”?

Even more important: Are you saying you’ll start a little boutique consulting firm, like with just you doing the consulting?

Or are you saying you want to launch a STARTUP in all sense of the word: You’ll go for growth, seek VC funding, look to get huge in the market?

Lots of times BSers say in their MBA essays that they plan to start in A Geography and then in a few years, expand out to B, and then to C and to D.

And we usually say, “Oh really?”

Starting a company — any company, of any size or ambition — is a monumental effort. Yes we’re certain many of you will do it some day, but far fewer will than those who are claiming.

There are very very different considerations that come into play if you’re going to bootstrap an operation, self-funding through your own resources and those of your family and close circle, or maybe get a small investment from some angels you already know, versus if you’re going to try to be the next Facebook or Uber, where you’ll need to go for multiple rounds of venture financing and have a huge staff and many advisors and a board who are hopefully seasoned managers themselves who can assist in providing guidance for the growing pains and challenges of such a big undertaking.

Just like when people say that they want to go to Harvard or bust, people often get a bit starry-eyed on their venture ambitions. There’s nothing wrong with that, and in fact motivation and enthusiasm are absolutely critical preconditions to any such type of success.

But you need to be at least knowledgeable enough about the world of business to appreciate what the term “startup” means. Many people on the street will assume “start a company” just means you’re going to hang a shingle and open your own business to meet some need in the market. Many others though hear the word “startup” and they instantly assume you mean you’re going to fling yourself over the edge: Max out your credit cards and get your parents to give you money and work 7 days a week for 9 months straight with no break with 12 hour days being minimum. You’re going to hustle and boogie and make lots of cold-calls and figure out things you don’t know. You’re going to pair up with some friends and then they’ll bring in their friends and you’ll all be working for peanuts for at least a year if not more. You’ll go for fast growth and have dreams of market domination and obsess over metrics, praying for a hockey stick. You’ll spend too much time at TechCrunch and CrunchBase and at least you’re not on TMZ and YT anymore but you’ll always be stressed out and distracted and feeling like you didn’t get enough done. And it’ll be exhilarating and depressing and you’ll think you have utterly failed more times than you can count, but if you persevere, then maybe, just maybe…

That’s about it in a nutshell. But be clear on what you mean.

“I want to start a company” actually says nothing.

Interested in starting a company? These questions will help you decide whether to self-fund (sometimes disparaging called building a lifestyle company) or go for outside capital for a growth strategy https://t.co/ktmjytjdhs

— Essay Snark (@EssaySnark) January 23, 2018