Identity

Ask a founder what they do and one of the first things you’ll hear is the name of their company. It’s the first line of their bio and how they introduce themselves at dinner. If you’ve started something, you probably know the feeling.

It’s typical for a founder to feel like they are the company and the company is them.

Early on, that ownership and overlap is a big part of what gets things moving. There’s no salary and not much evidence yet, so belief is most of what keeps the thing alive. The wins feel like yours because they are.

Most founders go through this, and there’s nothing wrong with it.

The danger with this shows up gradually. Somewhere along the way, the space between building a company and being the company closes, and a problem in the business starts to feel like a problem with the person who started it.

The story of Icarus fits here in a real way. The wings got him off the ground, and they were the same wings that failed when he flew too close to the sun.

Identity works a lot like that. The overlap between founder and company is what lifts you in the early days, and the trouble starts when you stop noticing how high you’ve climbed. It’s perfectly avoidable for founders who are mindful and intentional about it, and most of this page is about how.

Where I’ve Seen It From

Most of that career has been a terrific success. I have helped build companies from an idea on a napkin into lasting leaders in their segments, and I’ve been in the room when startups were acquired. And while I cared (and still care) deeply about these efforts, I maintained an employee (or contributor) mindset that made it easy to close the laptop at the end of the day and disconnect or move on when the time came.

The company I co-founded and led as CEO from 2014 through the end of 2020 was a totally different experience, and it failed in spectacular fashion in large part because of my failure to make that distinction.

My life ran through that company, including my friendships and my plans for the future, so much so that I eventually couldn’t tell where I ended and the company began.

For a while, that helped. Later, every problem in the business felt like something about me, and I made choices I’d never have imagined making at the start. Those choices hurt people who believed in me.

I’ve spent the years since studying startup failure. Identity is the pattern I notice first in almost every story I look at, including my own.

What the Research Says

Psychologists have been studying this for decades, and some of their work describes what I went through better than I could have at the time.

Robert Vallerand, a psychologist at the Université du Québec à Montréal, and his colleagues drew a line between two kinds of passion. With harmonious passion, the activity is a big part of who you are, and you’re still the one choosing when to engage with it. With obsessive passion, the activity gets folded into your identity with strings attached, usually because your self-worth or other people’s approval is riding on it. Obsessive passion is linked to rigid persistence, which means sticking with something even when it’s costing you. Nearly every founder cares deeply about the company. The harder question is whether you can still step back from it when you need to.

Sport psychologists have seen something similar in athletes. Britton Brewer, Judy Van Raalte, and Darwyn Linder described athletic identity as how strongly a person identifies with the role of athlete, and their paper asked whether it was “Hercules’ muscles or Achilles heel.” They argued it can be both. A strong athletic identity can help someone commit and perform, and when it’s the only identity a person has, an injury or the end of a career takes away a lot more than a sport. Founders face a version of the same question.

The idea I keep coming back to is identity fusion, which William Swann, a social psychologist at the University of Texas at Austin, studied with his colleagues. Most earlier work on group identity assumed that when people identify strongly with a group, their personal sense of self fades into the background. They start to see themselves as interchangeable members, which makes them good at falling in line and unlikely to do anything extraordinary on their own. Fused people work differently. Their personal self stays fully switched on, and the person and the group reinforce each other.

To measure it, Swann’s team showed people a small circle for the self and a larger circle for the group, drawn five ways with more and more overlap. In the last drawing, the small circle sits completely inside the big one, and the people who picked that one were considered fused. In their studies (mostly with Spanish participants, thinking about Spain), fused people said they were more willing to fight or die for their country, especially when something had stirred up their sense of self or their sense of the group. That research is mostly about groups and nations, but plenty of founders will still recognize themselves in it.

The Incentives Around the Founder

In my talks, I describe startup failure at three levels (systemic, organizational, and individual). Identity looks like an individual problem, but the other two levels feed it.

On a systemic level, we have a startup culture that celebrates the founder who never quits, and press coverage that puts the founder’s face on the company. Investors like to say they bet on the founder. Every one of those signals tells a founder that they and the company are the same thing.

Inside the company, the people closest to the founder have their own reasons to protect the story. Employees feel as though they need the company to work, and boards tend to prefer good news. In early-stage startups, it’s often the case that it’s nobody’s job to point out that the founder and the company are separate things.

Where Founder-Company Identity Struggles Begin

It usually starts with feedback. A customer saying no or an investor passing begins to feel personal, like they’ve turned you down.

Changing direction gets harder. A pivot means admitting that part of the story was wrong, and when the story is yours, it’s easy to put off changes the market has been asking for.

Your role starts to define your worth. If your job is to raise the money or land the customers and it isn’t happening, it feels like you’re failing at the thing that justifies your place.

Good news becomes a need. The founder starts needing the numbers to look a certain way, and the team learns which facts to bring into the room.

Letting go feels impossible. Stepping aside or winding down starts to look like a decision about who you’ll be afterward.

And the people who depend on you turn into a private debt. An investor can spread risk across a portfolio, but an employee can’t diversify a paycheck. When you treat everyone’s belief as one personal obligation, it gets harder to talk plainly with any of them about risk.

The Best Founders Find the Appropriate Distance Between Themselves and Their Company

What helps is enough distance to see the business clearly while you still care about it, and that distance comes from habits you set up with clear intentionality.

Disconnect once in a while. Go on a vacation, or totally unplug and go through the exercise of handing over the keys to another person for a week or two at a time. It’s a gut-check on how your systems stand up without you (and most importantly, it shows you that you can trust that the startup has its own identity and can live without you).

Pay attention to two kinds of statements. One describes what happened to the company: “Our customers aren’t renewing.” The other describes what you think it says about you: “I’m not good enough to pull this off.” Keep them apart, on paper if you have to. Only the first one tells you what to do next.

Ask the outsider question. If this were a friend’s company, what would you see, and what would you tell them? Most of us are wiser about a friend’s problems than about our own.

Keep a life outside the company, with people and interests that don’t depend on how the quarter goes, and ask yourself what would still be yours if the company ended tomorrow.

Make “this isn’t working yet” safe to say, for you and for your team, so bad news doesn’t get managed on its way up.

Talk about risk out loud with the people who depend on you, before things get hard.

Decide in advance, while you’re calm, what evidence would change your mind about the company. All of this works best when it starts early, long before the company is in trouble.

Founders who fall into this pattern are usually well-meaning people under real pressure. I was one of them, and the choices I made were my own.

Further reading

• “You Are Not Your Startup, Your Startup is Not You” in HackerNoon
• “Sam Mangel to Sam Bankman-Fried: Acceptance Is the Path Forward” in HackerNoon