I've worked in a People role at seven early-stage firms for over 15 years (I enjoy chasing a dream!). Few of the seven achieved profitability, including unicorn status or acquisition.

Did early-stage startups share anything? Was there a difference between winners and losers? YES.

I support founders and entrepreneurs building financially sustainable enterprises with a compelling cause. This isn't something everyone would do. A company's success demands more than guts. Founders drive startup success.

Six Qualities of Successful Startups

Successful startup founders either innately grasped the correlation between strong team engagement and a well-executed business model, or they knew how to ask and listen to others (executive coaches, other company leaders, the team itself) to learn about it.

Successful startups:

1. Co-founders agreed and got along personally.

Multi-founder startups are common. When co-founders agree on strategic decisions and are buddies, there's less friction and politics at work.

As a co-founder, ask your team if you're aligned. They'll explain.

I've seen C-level leaders harbor personal resentments over disagreements. A co-departure founder's caused volatile leadership and work disruptions that the team struggled to manage during and after.

2. Team stayed.

Successful startups have low turnover. Nobody is leaving. There may be a termination for performance, but other team members will have observed the issues and agreed with the decision.

You don't want organizational turnover of 30%+, with leaders citing performance issues but the team not believing them. This breeds suspicion.

Something is wrong if many employees leave voluntarily or involuntarily. You may hear about lack of empowerment, support, or toxic leadership in exit interviews and from the existing team. Intellectual capital loss and resource instability harm success.

3. Team momentum.

A successful startup's team is excited about its progress. Consistently achieving goals and having trackable performance metrics. Some describe this period of productivity as magical, with great talents joining the team and the right people in the right places. Increasing momentum.

I've also seen short-sighted decisions where only some departments, like sales and engineering, had goals. Lack of a unified goals system created silos and miscommunication. Some employees felt apathetic because they didn't know how they contributed to team goals.

4. Employees advanced in their careers.

Even if you haven't created career pathing or professional development programs, early-stage employees will grow and move into next-level roles. If you hire more experienced talent and leaders, expect them to mentor existing team members. Growing companies need good performers.

New talent shouldn't replace and discard existing talent. This creates animosity and makes existing employees feel unappreciated for their early contributions to the company.

5. The company lived its values.

Culture and identity are built on lived values. A company's values affect hiring, performance management, rewards, and other processes. Identify, practice, and believe in company values. Starting with team values instead of management or consultants helps achieve this. When a company's words and actions match, it builds trust.

When company values are beautifully displayed on a wall but few employees understand them, the opposite is true. If an employee can't name the company values, they're useless.

6. Communication was clear.

When necessary information is shared with the team, they feel included, trusted, and like owners. Transparency means employees have the needed information to do their jobs. Disclosure builds trust. The founders answer employees' questions honestly.

Information accessibility decreases office politics. Without transparency, even basic information is guarded and many decisions are made in secret. I've seen founders who don't share financial, board meeting, or compensation and equity information. The founders' lack of trust in the team wasn't surprising, so it was reciprocated.

The Choices

Finally. All six of the above traits (leadership alignment, minimal turnover, momentum, professional advancement, values, and transparency) were high in the profitable startups I've worked at, including unicorn status or acquisition.

I've seen these as the most common and constant signals of startup success or failure.

These characteristics are the product of founders' choices. These decisions lead to increased team engagement and business execution.

Here's something to consider for startup employees and want-to-bes. 90% of startups fail, despite the allure of building something new and gaining ownership. With the emotional and time investment in startup formation, look for startups with these traits to reduce your risk.

Both you and the startup will thrive in these workplaces.

If you're not genuine, you'll be revealed.

Sam Bankman-Fried (SBF) was called the Cryptocurrency Warren Buffet.

No wonder.

SBF's trading expertise, Blockchain knowledge, and ability to construct FTX attracted mainstream investors.

He had a fantastic worldview, donating much of his riches to charity.

As the onion layers peel back, it's clear he wasn't the altruistic media figure he portrayed.

SBF's mistakes were disastrous.

• Customer deposits were traded and borrowed by him.

• With ten other employees, he shared a $40 million mansion where they all had polyamorous relationships.

• Tone-deaf and wasteful marketing expenditures, such as the $200 million spent to change the name of the Miami Heat stadium to the FTX Arena

• Democrats received a $40 million campaign gift.

• And now there seems to be no regret.

FTX was a 32-billion-dollar cryptocurrency exchange.

It went bankrupt practically overnight.

SBF, FTX's creator, exploited client funds to leverage trade.

FTX had $1 billion in customer withdrawal reserves against $9 billion in liabilities in sister business Alameda Research.

Bloomberg Billionaire Index says it's the largest and fastest net worth loss in history.

It gets worse.

SBF's net worth is $900 Million, however he must still finalize FTX's bankruptcy.

SBF's arrest in the Bahamas and SEC inquiry followed news that his cryptocurrency exchange had crashed, losing billions in customer deposits.

A journalist contacted him on Twitter D.M., and their exchange is telling.

His ideas are revealed.

Kelsey Piper says they didn't expect him to answer because people under investigation don't comment.

Bankman-Fried wanted to communicate, and the interaction shows he has little remorse.

SBF talks honestly about FTX gaming customers' money and insults his competition.

Reporter Kelsey Piper was outraged by what he said and felt the mistakes SBF says plague him didn't evident in the messages.

Before FTX's crash, SBF was a poster child for Cryptocurrency regulation and avoided criticizing U.S. regulators.

He tells Piper that his lobbying is just excellent PR.

It shows his genuine views and supports cynics' opinions that his attempts to win over U.S. authorities were good for his image rather than Crypto.

SBF’s responses are in Grey, and Pipers are in Blue.

It's unclear if SBF cut corners for his gain. In their Twitter exchange, Piper revisits an interview question about ethics.

SBF says, "All the foolish sh*t I said"

SBF claims FTX has never invested customer monies.

Piper challenged him on Twitter.

While he insisted FTX didn't use customer deposits, he said sibling business Alameda borrowed too much from FTX's balance sheet.

He did, basically.

When consumers tried to withdraw money, FTX was short.

SBF thought Alameda had enough money to cover FTX customers' withdrawals, but life sneaks up on you.

SBF believes most exchanges have done something similar to FTX, but they haven't had a bank run (a bunch of people all wanting to get their deposits out at the same time).

SBF believes he shouldn't have consented to the bankruptcy and kept attempting to raise more money because withdrawals would be open in a month with clients whole.

If additional money came in, he needed $8 billion to bridge the creditors' deficit, and there aren't many corporations with $8 billion to spare.

Once clients feel protected, they will continue to leave their assets on the exchange, according to one idea.

Kevin OLeary, a world-renowned hedge fund manager, says not all investors will walk through the open gate once the company is safe, therefore the $8 Billion wasn't needed immediately.

SBF claims the bankruptcy was his biggest error because he could have accumulated more capital.

Final Reflections

Sam Bankman-Fried, 30, became the world's youngest billionaire in four years.

Never listen to what people say about investing; watch what they do.

SBF is a trader who gets wrecked occasionally.

Ten first-time entrepreneurs ran FTX, screwing each other with no risk management.

It prevents opposing or challenging perspectives and echo chamber highs.

Twitter D.M. conversation with a journalist is the final nail.

He lacks an experienced crew.

This event will surely speed up much-needed regulation.

It's also prompted cryptocurrency exchanges to offer proof of reserves to calm customers.

A fascinating business conversation.

This week at Web Summit, I had mentor hour.

Mentor hour connects startups with experienced entrepreneurs.

The YC-selected founder who mentored me had grown his company to $100 million in 18 months.

I had 45 minutes to question him.

I've compiled this.

Context

Founder's name is Zack.

After working in private equity, Zack opted to acquire an MBA.

Surrounded by entrepreneurs at a prominent school, he decided to become one himself.

Unsure how to proceed, he bet on two horses.

On one side, he received an offer from folks who needed help running their startup owing to lack of time. On the other hand, he had an idea for a SaaS to start himself.

He just needed to validate it.

Validating

Since Zack's proposal helped companies, he contacted university entrepreneurs for comments.

He contacted university founders.

Once he knew he'd correctly identified the problem and that people were willing to pay to address it, he started developing.

He earned $100k in a university entrepreneurship competition.

His plan was evident by then.

The other startup's founders saw his potential and granted him $400k to launch his own SaaS.

Hiring

He started looking for a tech co-founder because he lacked IT skills.

He interviewed dozens and picked the finest.

As he didn't want to wait for his program to be ready, he contacted hundreds of potential clients and got 15 letters of intent promising they'd join up when it was available.

YC accepted him by then.

He had enough positive signals to raise.

Raising

He didn't say how many VCs he called, but he indicated 50 were interested.

He jammed meetings into two weeks to generate pressure and encourage them to invest.

Seed raise: $11 million.

Selling

His objective was to contact as many entrepreneurs as possible to promote his product.

He first contacted startups by scraping CrunchBase data.

Once he had more money, he started targeting companies with ZoomInfo.

His VC urged him not to hire salespeople until he closed 50 clients himself.

He closed 100 and hired a CRO through a headhunter.

Scaling

Three persons started the business.

1. He primarily works in sales.

2. Coding the product was done by his co-founder.

3. Another person performing operational duties.

He regretted recruiting the third co-founder, who was ineffective (could have hired an employee instead).

He wanted his company to be big, so he hired two young marketing people from a competing company.

After validating several marketing channels, he chose PR.

$100 Million and under

He developed a sales team and now employs 30 individuals.

He raised a $100 million Series A.

Additionally, he stated

• He’s been rejected a lot. Like, a lot.

• Two great books to read: Steve Jobs by Isaacson, and Why Startups Fail by Tom Eisenmann.

• The best skill to learn for non-tech founders is “telling stories”, which means sales. A founder’s main job is to convince: co-founders, employees, investors, and customers. Learn code, or learn sales.

Conclusion

I often read about these stories but hardly take them seriously.

Zack was amazing.

Three things about him stand out:

1. His vision. He possessed a certain amount of fire.

2. His vitality. The man had a lot of enthusiasm and spoke quickly and decisively. He takes no chances and pushes the envelope in all he does.

3. His Rolex.

He didn't do all this in 18 months.

Not really.

He couldn't launch his company without private equity experience.

These accounts disregard entrepreneurs' original knowledge.

Hormozi will tell you how he founded Gym Launch, but he won't tell you how he had a gym first, how he worked at uni to pay for his gym, or how he went to the gym and learnt about fitness, which gave him the idea to open his own.

Nobody knows nothing. If you scale quickly, it's probable because you gained information early.

Lincoln said, "Give me six hours to chop down a tree, and I'll spend four sharpening the axe."

Sharper axes cut trees faster.

Looking back into the past can help you understand what's happening today and why.

"Creator economy" conjures up images of originality, sincerity, and passion. Where do Michelangelos and da Vincis push advancement with their gifts without battling for bread and proving themselves posthumously? 

Creativity has been as long as humanity, but it's just recently become a new economic paradigm. We even talk about Web3 now.

Let's examine the creative economy's history to better comprehend it. What brought us here? Looking back can help you understand what's happening now.

No yawning, I promise 😉.

Creator Economy's history

Long, uneven transition to creator economy. Let's examine the economic and societal changes that led us there.

1. Agriculture to industry

Mid-18th-century Industrial Revolution led to shift from agriculture to manufacturing. The industrial economy lasted until World War II.

The industrial economy's principal goal was to provide more affordable, accessible commodities.

Unlike today, products were scarce and inaccessible.

To fulfill its goals, industrialization triggered enormous economic changes, moving power from agrarians to manufacturers. Industrialization brought hard work, rivalry, and new ideas connected to production and automation. Creative thinkers focused on that then.

It doesn't mean music, poetry, or painting had no place back then. They weren't top priority. Artists were independent. The creative field wasn't considered a different economic subdivision.

2. The consumer economy

Manufacturers produced more things than consumers desired after World War II. Stuff was no longer scarce.

The economy must make customers want to buy what the market offers.

The consumer economic paradigm supplanted the industrial one. Customers (or consumers) replaced producers as the new economic center.

Salesmen, marketing, and journalists also played key roles (TV, radio, newspapers, etc.). Mass media greatly boosted demand for goods, defined trends, and changed views regarding nearly everything.

Mass media also gave rise to pop culture, which focuses on mass-market creative products. Design, printing, publishing, multi-media, audio-visual, cinematographic productions, etc. supported pop culture.

The consumer paradigm generated creative occupations and activities, unlike the industrial economy. Creativity was limited by the need for wide appeal.

Most creators were corporate employees.

Creating a following and making a living from it were difficult.

Paul Saffo said that only journalists and TV workers were known. Creators who wished to be known relied on producers, publishers, and other gatekeepers. To win their favor was crucial. Luck was the best tactic.

3. The creative economy

Consumer economy was digitized in the 1990s. IT solutions transformed several economic segments. This new digital economy demanded innovative, digital creativity.

Later, states declared innovation a "valuable asset that creates money and jobs." They also introduced the "creative industries" and the "creative economy" (not creator!) and tasked themselves with supporting them. Australia and the UK were early adopters.

Individual skill, innovation, and intellectual property fueled the creative economy. Its span covered design, writing, audio, video material, etc. The creative economy required IT-powered activity.

The new challenge was to introduce innovations to most economic segments and meet demand for digital products and services.

Despite what the title "creative economy" may imply, it was primarily oriented at meeting consumer needs. It didn't provide inventors any new options to become entrepreneurs. Instead of encouraging innovators to flourish on their own, the creative economy emphasized "employment-based creativity."

4. The creator economy

Next, huge IT platforms like Google, Facebook, YouTube, and others competed with traditional mainstream media.

During the 2008 global financial crisis, these mediums surpassed traditional media. People relied on them for information, knowledge, and networking. That was a digital media revolution. The creator economy started there.

The new economic paradigm aimed to engage and convert clients. The creator economy allowed customers to engage, interact, and provide value, unlike the consumer economy. It gave them instruments to promote themselves as "products" and make money.

Writers, singers, painters, and other creators have a great way to reach fans. Instead of appeasing old-fashioned gatekeepers (producers, casting managers, publishers, etc.), they can use the platforms to express their talent and gain admirers. Barriers fell.

It's not only for pros. Everyone with a laptop and internet can now create.

2022 creator economy:

Since there is no academic description for the current creator economy, we can freestyle.

The current (or Web2) creator economy is fueled by interactive digital platforms, marketplaces, and tools that allow users to access, produce, and monetize content.

No entry hurdles or casting in the creative economy. Sign up and follow platforms' rules. Trick: A platform's algorithm aggregates your data and tracks you. This is the payment for participation.

The platforms offer content creation, design, and ad distribution options. This is platforms' main revenue source.

The creator economy opens many avenues for creators to monetize their work. Artists can now earn money through advertising, tipping, brand sponsorship, affiliate links, streaming, and other digital marketing activities.

Even if your content isn't digital, you can utilize platforms to promote it, interact and convert your audience, and more. No limits. However, some of your income always goes to a platform (well, a huge one).

The creator economy aims to empower online entrepreneurship by offering digital marketing tools and reducing impediments.

Barriers remain. They are just different. Next articles will examine these.

Why update the creator economy for Web3?

I could address this question by listing the present creator economy's difficulties that led us to contemplate a Web3 upgrade.

I don't think these difficulties are the main cause. The mentality shift made us see these challenges and understand there was a better reality without them.

Crypto drove this thinking shift. It promoted disintermediation, independence from third-party service providers, 100% data ownership, and self-sovereignty. Crypto has changed the way we view everyday things.

Crypto's disruptive mission has migrated to other economic segments. It's now called Web3. Web3's creator economy is unique.

Here's the essence of the Web3 economy:

• Eliminating middlemen between creators and fans.

• 100% of creators' data, brand, and effort.

• Business and money-making transparency.

• Authentic originality above ad-driven content.

In the next several articles, I'll explain. We'll also discuss the creator economy and Web3's remedies.

Final thoughts

The creator economy is the organic developmental stage we've reached after all these social and economic transformations.

The Web3 paradigm of the creator economy intends to allow creators to construct their own independent "open economy" and directly monetize it without a third party.

If this approach succeeds, we may enter a new era of wealth creation where producers aren't only the products. New economies will emerge.

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