What the Doomsayers are Missing, by Scott Yates

Founder Feedback gives you insights from the startup trenches. In a story originally posted to his blog Sco.tt (cool URL, right?!), Scott Yates, Founder at BlogMutt, describes his experience in startup land these past few months, and why he thinks the doomsayers citing a "winter of discontent" are missing the point.

You can read the full story titled "Now is the August of our Discontent" here. Below is an excerpt. 

"The kernel of this post started with a simple Facebook post after a lovely evening of corn on the cob, ice cream on the deck, and relaxing with the family:

'Just a lovely summer evening out there. Seems to happen every August: life seems so wonderful within the family and the world goes nusto -- the stock market goes screwy, some youths somewhere go all nuts (London's turn this year) and politicians become especially unsavory. I wish summer could last longer for us, but the world could use a good rain shower and some adult supervision.'

...All of those August events led some notable folks to start talking about something very much on my mind these days, investments in startup companies. I won't link to those posts, because I'm going to slam them now by pointing out simply that it's always easy to forecast doom.

What I didn't read anywhere was this: If the stock market sucks as a place to keep money, wouldn't that help startups and other alternative investments? I mean, only those with tinfoil hats are suggesting that you should take all your money out of the markets and put it in gold. You'd have to be exceptionally bad at math to keep it in a bank. Wouldn't all that money do better investing in something that actually has a chance to grow? Not to get preachy, but they'd be also be able to invest in the one thing that everyone says is the best way to create new jobs. I understand there's more risk, but with risk comes...

Ahh nevermind. Let's move on.

The good news for startups is that smart investors understand that market fluctuations are materially irrelevant to what they do. George Zachary made the case very clearly in a single tweet: 

'No matter what happens with public markets, my CRV partners & I will still be actively funding early stage founders pursuing the bold.'

Adeo Ressi made the case, properly I think, that this is actually a time when we should have some cautious optimism. Brad Feld and Seth Levine of the Foundry group both made essentially the same case as Zachary and Ressi, but they did it in their own inimitable style, Brad saying "ignore the dow" and Seth with a long, reasoned post full of words like "numerator" and "capital efficiency."

The bottom line for all of them was the same bottom line I got reading about why love is the opposite of underwear: Do what you love so much that it doesn't get boring, and have grit about sticking with it. VCs and neuroscientists agree!

And so does the writer of this excellent story: "A Few Thousand Reasons to Be Optimistic"...

The prognosticators who came out and said that the market volatility signaled the end of all investments in startups were, I think, essentially emulating Shakespeare in saying: "Now is the winter of our discontent." (One of them, whom I still respect a great deal, actually said "winter is coming.")

What they didn't do, however, was read the next line.

Now is the winter of our discontent

Made glorious summer by this son of York

You see that? What Richard is saying there is that the winter is now made into a glorious summer by the son (sun).

The doom-and-gloomers are missing that. They want you to believe that things will be bad bad bad.

This is something that was not lost, by the way, on Steinbeck when he wrote The Winter of our Discontent. That book centers on a man who worked hard, had strong ethics, but then let his ethics slip so that he could make a buck and get ahead. It was a cautionary tale that we've seen played out in everything from Glengarry Glen Ross and Bonfire of the Vanities through Gordon Gekko and right up to The Social Network.

Some people learn from these kinds of stories what not to do, and some learn the upside down lesson that if they cheat, if they worry about superficial gains, if they wear a hoody and tell people that a billion dollars is cool, that somehow they will get ahead. Those people might for a while, too, but for the world winter is a good thing because that hoody just isn't enough to get you through a winter...

Just by way of background, I'm the CEO of a startup that uses a crowd of writers to help businesses do the blogging that they don't have the time or ability to do themselves... 

I have to admit that I've perhaps spent a bit too much of the last few months getting too close to the world of the kid in the hoody talking about how a billion dollars is cool...

We are still technically fundraising. We are still taking those meetings and we certainly would love to have some more money in the bank. We'd also love to have the connection to real leaders in our world that comes in an unparalleled way with a real investment. But now that we have customers we are realizing firsthand the truism that the best kind of investment is a customer paying for something that provides value. We have those customers now, and we have freelance writers who enjoy writing for those customers.

Our plan is that the warmth radiating from delighted customers and writers will make a glorious summer out of whatever winter comes our way.

A glorious summer. Not the August zaniness, just the ice cream gloriouisness.

Mmmmmmm. Ice cream."

BlogMutt, a service that provides blog content for small or niche blogs using a crowd of writers, has launched in private beta. BlogMutt is a Graduate of the Denver/ Boulder Founder Institute. Follow Scott Yates on Twitter at @scodtt.