Jul 14, 2019
Jen Greyson is one of the top eight women in crypto and is a genius at failure. She’s currently running co.co, a start-up that’s the Airbnb of office space, speaks internationally on topics ranging from AI to being a female tech founder and knows the struggle of being a working parent through the longest summer.
“I should have left sooner, I would have still prospered like I did had I left when I knew I should leave. I stayed because of my investment, because of my sunk costs. I stayed longer than I should have. If I would have trusted myself when I knew I needed to go it would have been much more beneficial.”
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About four years ago, Jen had built the perfect life for herself. She was a new single mom, was ghostwriting for an amazing client that she had had for a few years and worked one day a week. She would go hiking with her dog and had a great home on a lake. Then she met a captivating computer engineer who was into AI. Over long lunches she would hear from him about virtual reality, AI and other things she thought only existed in science fiction. His goal was to build artificial intelligence “for good”, to create a level playing field so that some young person in Switzerland who wants to use AI to complete a college exam has the same chance as a CEO working for a Fortune 100 company that can afford to pay a huge AWS bill.
The more she started looking into the idea, the more she liked it. She offered to help with his writing really wanted to be a part of the process because it was world-changing. She was also newly divorced, had a lot of freedom and was financially doing well. So she dug into his business plan and her business brain kicked in. She had run some big businesses but had left corporate America never wanting to return. He suggested one afternoon: “You should come run my company for me.” And at this point, she was fully wrapped up in the idea, “had drunk the Kool Aid” and was really excited about it.
While not wanting to get back into her pantsuit, the idea of reinventing the way corporate structures worked appealed greatly. So even though she would be running this company, it was a start-up and they would be doing it on the global stage using crypto. That community was very welcoming and she saw the potential of the project and the potential to have an impact on small businesses, through neigborhood stores to college kids, and other players who really needed AI could have it. She had some money saved and the engineer didn’t but she decided to back the idea because she believed in it. They had a good plan in place, as with every start-up in the beginning. And the thinking, as with all new businesses is, in 90 days they would be rolling in money. Jen agreed to bridge the company us for 90 days and took out some loans.
After the 90 days, they had some momentum so Jen decided to bridge the company for another 90, and another 90, and another 90, and we ended up raising some money from some other people. But, it started to go badly. Targets were not getting met, things were not getting done, sections of the project were not getting coded. It was her first experience with software development and she was really having to rely on his expertise. But she was also relying on her own expertise in running the business. She knew very well about deadlines and managing people and projects and making sure that what they promised, gets delivered.
They started having many major complications and Jen as CEO held the fiduciary responsibility. She started feeling uneasy about what their investors were getting out of the deal and that her partner was wanting to start raising more money. She also felt bad about the risk she was taking because the SEC was really starting to look at crypto projects but the regulations were opaque, which meant risk. She was having conversations with lawyers around the world and in-house to navigate the regulation landscape. And Jen was personally committed to the tune of US$150,000, which made decisions difficult to make as a CEO without thinking about the money she was risking or that she had committed.
She was making decisions that might have been different if her money was not at stake. She met a mentor and, while she didn’t want to give up on the project, needed clarity. She had invested in it, believed in it, and truly wanted to have an impact on all those lives. The mentor asked her: “What would you say to a CEO in your position if you were coming on today as an advisor?” She was rocked, but it allowed her to look at the loss as a sunk cost and that that money was truly gone, never to be returned, and to ask herself what decisions she needed to make today?
She left that meeting able to separate herself from the disappointment, the hurt, the anger at herself and to unemotionally, unattached, look at the situation clearly. It then made the next decision easy. She handed in her resignation and that was the end of it, except that she learned a lot of amazing things, and now considers it her “most brilliant failure” for sure.
“What would you say to a CEO in your position if you were coming on today as an advisor?”
Jen Greyson’s mentor
You must have a plan for when the start-up goes really bad.
Have a relationship with the people you’re going into business with or only work with people who know how to communicate and with whom there is mutual respect.
“Anytime you start a business with someone, it’s all unicorn farts and rainbows … Everything is glitter and beautiful and wonderful. And then, like any relationship, it gets hard and the honeymoon ends.”
Collated from the My Worst Investment Ever series, the six main categories of mistakes made by interviewees, starting from the most common, are:
When you invest in a start-up, it is such a high-risk activity that Andrew usually recommends against it. Doing business with or investing in friends’ enterprises doesn’t always work, but it can work. It doesn’t always work with family, but it can work. Some people can truly earn our trust through good performance over a long period.
Trust: The first question he asks is: Do I trust this person? Trust is only built over time, it’s very hard to walk into a new situation and say “I trust this person”
If there’s no trust from the start … STOP.
Idea: Is it a good idea? If it is not … STOP.
Execution: Can this person or team execute on this idea? There’s a huge difference between the type of person who can come up with an idea and the type of person who can execute on it. Part of Jen’s story was that her team started missing deadlines. They lacked the ability to execute the plan.
Money: If you don’t have money, you’re not going to get there. So you’ve got to have the runway that money provides.
Normally what people say is: “I want the CEO to have skin in the game. I want the CEO to be aligned with the other shareholders and the other investors.” But the reality is that for CEOs, sometimes it’s all of their capital. Meanwhile others are investing perhaps just 1% or 5% of their total capital so the way they think is very different. I never thought about that.
It can be applied to any part of life, even apply to relationships. Knowing what you know now (about this enterprise or relationship or job) would you still get involved with it if you just encountered it now?
“If the answer is yes, awesome, keep building it. If the answer is no, that’s very valuable information.”
Jen says she should have left sooner and stayed longer than she should have.
Jen is 100% thrilled about her current start-up, mostly because he has some great partners. She’s excited to see that starting to change lives and is committed to creating spaces where people can work.
“Each of us can start changing the world.”
As a mother of two boys, she always I always want amazing things to happen for them. And so I'm excited to see what they get to accomplish in the next year.
Every failure has a lesson, and learn it the first time, or the lessons will get bigger, harder and bloodier.