Because of the work I do coaching and advising startups I am sometimes asked “What’s The Most Important Skill for A Founder to Have?” I think that often people expect me to say something about technical know-how or “market-smarts” or financial acumen. All of those are important, to be sure. But after having seen more than 100 startups as a mentor at Creative Destruction Labs and after having worked with about 2 dozen of them in some detail and for some time, I would say none of those are as important as one skill or trait. And that is the ability to live with and resolve “The Stockdale Paradox.” Which I will explain in moment.
To avoid appearing to be mysterious I will say that this is a short way of encapsulating the traits of Grit, Determination, and Resilience. These are the most important traits of successful founders. They are exactly what Jim Collins had in mind when he coined the term “The Stockdale Paradox.”
So, to back the tape up a bit here and explain. First of all, Jim Collins – if you are not aware – was an American author and researcher who wrote a series of books on what it took to be successful in business. One of these, “Good to Great,” is about what separates truly “Great” companies from their competitors who were merely “Good.” The book was the result of extensive research in which Collins and his team interviewed dozens of companies and then searched the accumulated interviews for the patterns that differentiated the market leading competitors from the others.
It is a fascinating book. At its heart it is about how to create a great organization – which is why I have used it as a textbook in MBA courses. For this discussion, I want to focus on one particular chapter – which Collins calls “The Stockdale Paradox.”
In that chapter he tells the story of, and describes the interview he had with, Admiral James Stockdale. Stockdale is a famous Vietnam war hero. He was shot down early in the conflict, captured and he spent the rest of the war as a POW in the infamous Hanoi Hilton. He was the highest-ranking officer held prisoner. He was tortured and beaten frequently. He was a hero because even in the face of that treatment and against all the efforts of his captors he was able to support and organize the other POWs.
Everyone who survived their captivity credited James Stockdale with being critical to their survival. He not only endured, but he also found a way to continue moving forward, to continue making a difference, to continue to be an example to others, even in the face of treatment that most of us would find to be unendurable.
Jame Stockdale found a way not only to endure the unendurable but to, eventually, succeed. He not only in came home more or less whole, but he also brought many other men with him. Many of those men might not have come home whole – or at all – without him. I am summarizing and I am not really doing the story justice, if you are interested it is worth researching – it is certainly worth reading what Jim Collins has to say on the subject.
The most important part of that description is the final question that Collins asked Admiral Stockdale. After having been transfixed and amazed by the story Collins basically asked “What was the secret? Why did you make it when so many did not?”
I am going to take the liberty of quoting that passage from the book, because I really don’t think it is possible to improve on Admiral Stockdale’s answer:
I didn’t say anything for many minutes, and we continued the slow walk toward the faculty club, Stockdale limping and arc-swinging his still leg that had never fully recovered from repeated torture. Finally, after about a hundred meters of silence, I asked, “Who didn’t make it out?”
“Oh, that’s easy,” he said. “The optimists.”
“The optimists? I don’t understand,” I said, now completely confused, given what he’d said a hundred meters earlier.
“The optimists. Oh, they were the ones who said, ‘We’re going to be out by Christmas.’ And Christmas would come, and Christmas would go. Then they’d say, ‘We’re going to be out by Easter.’ And Easter would come, and Easter would go. And then Thanksgiving, and then it would be Christmas again. And they died of a broken heart.”
Another long pause, and more walking. Then he turned to me and said, “This is a very important lesson. You must never confuse faith that you will prevail in the end — which you can never afford to lose — with the discipline to confront the most brutal facts of your current reality, whatever they might be.”
– Collins, Jim. Good to Great: Why Some Companies Make the Leap…And Others Don’t (p. 85). HarperCollins. Kindle Edition.
This is what Collins calls the Stockdale Paradox. How do you honestly confront the facts, no matter how brutal they may be – yet still not lose hope that you can find a way to survive and to thrive.
THIS is the most important trait that the founder of a new business can have. Without a doubt.
Every founder will experience times when they fail, in small and sometimes very large ways. The founders that succeed do so because of the way the confront those failures. The founders that agonize over them and analyse them and lose hope because of their failures will not survive them – at least not very many of them.
Often these are founders, the ones who don’t stay in business, have simply not been able to accept just how brutal the facts have become. They continue to apply falsely optimistic expectations to outcomes until the reality overwhelms them.
Which is not to say that successful founders are pessimists. They are not. Successful founders are absolutely convinced that they will be successful. But they also accept that it may require some unpleasant moments and unpalatable choices. These founders manage to resolve the Stockdale Paradox. They are realistic about the challenges they face, but are unshakeable in their commitment to face those challenges in order to find success.
This is a not really a skill. It is not learned. It has to be present in some form in order for any founder to succeed. I am absolutely convinced of that now having seen many founders in many different situations. The ability to confront the facts – however brutal they may and make a reasonable plan for dealing with the situation – while not being overwhelmed by just how brutal the facts are and keep moving forward is just an innate trait.
Some people have it. Some people don’t.
I am constantly amazed by the founders that can call me to discuss truly awful news one week – and call back the next week to tell me how they have decided to deal with it and have – literally moved on.
If you cannot do this, you cannot survive in this business. I know that from having done it, and eventually deciding that I did not want to anymore. I admire the resilience and grit that I see in founders because, in a very real way, it exceeds my own.
In fact, I am humbled and inspired by it.
So, if you are looking for a way of identifying a founder who will ultimately be successful, either as a prospective employer or as a target for your investment dollars. Ask them what’s the worst thing that happened to them in business. If they tell you they have always been successful, or if they tell you that they don’t dwell on past uncertainties, then be very careful. These are founders who have not come to grips with Admiral’s Stockdale’s important lesson.
The ones that tell you honestly about the hard times, and how they learned from them, how those hard times sharpened their focus on eventually being successful – those are the founders to follow – wherever they happen to lead you.
![[Contribution] Korea begins journey toward becoming global science and technology hub](https://todayheadline.co/wp-content/uploads/2024/12/Contribution-Korea-begins-journey-toward-becoming-global-science-and-technology-120x86.jpg)
