Thoughts on Facing Reality & Contrarian Thinking
Embrace reality and build a culture of authenticity to last in a shifting market.
Over the years—either from my own experience as a founder or through observing others—I've noticed a strange phenomenon loosely coined, "complaint hallucination." Perhaps you've experienced it? The tendency for people to distort their reality based on how they hope for things to be instead of how they actually are.
You'll find examples in every domain: startups sign a single low-level employee from Microsoft and put the Microsoft logo on their site, or a guru pays the right people to publish a Forbes article with the guru’s "accomplishments."
Some of it's hustle, some of it's bullshit. The line is very thin.
Don't get me wrong; do what it takes to grow your company. Hack what you need to stay alive. Every founder who built something from nothing remembers the early days of scrappy, duct-taped solutions... it's the awkward—but necessary—pre-teen phase of your business.
When I mention complaint hallucination I'm not referencing hacks, but talking about the lies that weak leaders tell themselves to feel better about their traction. For example:
The brand new real estate agent states, "I have a real estate business," right after getting licensed.
Hallucination: "I have an actual business."
Reality: No, you passed a test that allows you to work legally.
The startup that pays for a "#1 in [category]" award with a no-name publication.
Hallucination: "We're getting recognized as market leaders!"
Reality: You didn't win anything; you paid for placement in a tabloid because your traction wasn't significant enough to gain real media attention.
The influencer whose following grows only through paid promotions.
Hallucination: "People really enjoy my content and want to hear what I have to say!"
Reality: You're not a celebrity; you had to pay for attention because your content wasn't engaging enough to grow a large audience organically.
Complacent hallucination is a death sentence for your company. Fight it with the discipline of facing reality, not distorting your reality.
Your Mental Fortitude
Facing reality is the only way to succeed in the market. It's time to disband some of the feel-good, fluffy entrepreneurial advice that floats around. Guess what? Starting a business is incredibly exciting. It's a time of opportunity and dreaming big. It's also one of the hardest things you'll ever do. It's a rollercoaster of unknowns and uncertainty, wins and failures—all glued together with stress, confusion, and a bit of wishful thinking. The rewards are astronomical. The risk could be the total destruction of everything you've ever had.
Some people are crazy enough to gamble on those odds.
Yet gambling blind is not confidence, it's stupidity. Research from Investopedia concludes that 21.5% of startups fail in the first year, 30% in the second year, 50% in the fifth year, and 70% in the 10th year. You're already fighting an uphill battle with your startup—why increase the odds of failure? Refusing to face reality—living in a complacent hallucination—does just that.
You know what impacts your business more than cold 5 a.m. showers, positive affirmations, and motivational talks in the mirror? Revenue. Customers. Traction. Momentum. Results.
It's true that there’s a powerful connection between mental health and professional results; I've personally done 75 Hard twice in addition to annual misogi's, and I fully support doing hard things often. But don't be mistaken; habits of mental fortitude are not business-building habits, and those cold showers will feel really cold when your heat turns off because your anemic startup didn’t earn enough for you to pay your bills.
Fix the problem instead of mitigating symptoms, by making "yes" an exception in your startup—not the rule—and force yourself to view your reality for what it is, not just what you wish it were.
Here's the hard truth: markets are tightening, and the world is changing. As I write this piece, Russia is unleashing hell on Ukraine, and gas prices just hit a new all-time high. Standard series A rounds are starting to fall below $20M again, and public markets are chaotic. Half the world wants to return to work and see people, and the other half wants to live in a cabin away from the first half. Crypto markets are turning high-schoolers into millionaires, and Yuga Labs closed the most insane seed round I’ve ever seen—$450M at a $4B post-money valuation.
There is never a “normal” or “safe” time to launch a company, but one can argue that today’s environment is more chaotic than most. Adding unnecessary stress to your situation by refusing to stay disciplined and live in reality shouldn’t happen.
Applicability for Your Business
Okay, you’ve built mental fortitude and are confident in your ability to see your situation for its good, bad, and ugly. What about your business? This is where you embrace a culture of (healthy) contrarian thinking and radical candor in your startup.
Unbeknownst to some, embracing a contrarian culture is not an excuse to be a maniacal, undisciplined asshole. True contrarian thinking is mission-aligned, disciplined, educated, focused, and at the heart of leadership strength. Expression of radical candor empowers those who are driven and care about success—and exiles those who aren't.
Weak leaders surround themselves with "yes people" because hearing a contrarian opinion will shatter their self-identity and worth. Strong leaders are willing to hear the good and the bad, for they know important decisions aren't made in walled gardens.
Weak leaders refuse to disrupt the status quo because they falsely inflate being liked with being successful. Strong leaders know they're not here to make friends; they're here to move mountains.
Weak leaders seek affirmation. Strong leaders seek allies.
Weak leaders talk. Strong leaders work.
The contrast is stark and always present.
Have you ever worked for an executive who couldn't hear "no"? Someone who needed to be affirmed in their every move? How did you feel about their leadership? Leaders who can't hear a contrarian opinion without flustering win so slowly in the market that they lose by default, have feeble support from their teams, and accomplish little.
Instilling a healthy contrarian perspective into your culture is one of the few ways to break echo chambers of affirmation.
Reid Hoffman shares a great perspective on how to actually be contrarian instead of just being rude, concluding that intelligence is the core of contrarian thinking. If a well-educated response to your contrarian statement doesn’t exist, you're not being contrarian—you're looking for a fight. (Read/watch his lecture on How to Be a Great Founder, here.)
"When you think about being contrarian, you have to think about how is it that smart people disagree with me, that disagree with me from a position of intelligence. And there is something that I know that they don't know that will actually play out to be true. Now in this case, in general, as a founder it's good to be contrarian in the real sense."
The goal is to encourage everyone to express their authentic opinions, even if they go against the grain. Some of your most powerful ideas will come from associates identifying your blind spots—how will these associates have the confidence to express those opinions if contrarian thinking isn't an established part of your culture.
These concepts are simple to understand and hard to implement. Frankly, they're some of the reasons great founders are so hard to come by: dropping your ego, empowering others to be better than you, and outlasting the competition with unparalleled endurance takes a bit of crazy, and a lot of discipline.
I’ll be expanding on these thoughts later this year; for now, keep after it. You got this.