The Trap That Will Kill Your Startup
The uncomfortable discipline that separates companies that scale from companies that stall.
The most dangerous thing in a startup is not bad news.
It’s a room full of people pretending the bad news doesn’t exist.
I’ve built five companies. Invested in over 60 startups. Spent three years inside Adobe watching billion dollar product strategy up close. And the pattern I’ve seen more than any other, the one that quietly kills more companies than competition or capital ever will, is this:
Founders build cultures where optimism is the only acceptable frequency. And then they wonder why nobody told them the truth until it was too late.
Activity everywhere. Momentum nowhere.
That line could describe half the startups I’ve seen stall. And it described mine.
The Startup Optimism Trap
I am, by nature, an eternal optimist.
At ContentCal, I used to write free-flowing narrative business plans every year. Brain dumps of everything spinning in my head. Where we were going, what the next milestone looked like, how big this thing could get. I once titled one of them The World Does Not Belong to Pessimists.
When I shared the first version with some of my team, they stared at me like I’d lost my mind.
It was too broad, too fluid, too far from the bullet-pointed plans they expected. My “plan” was a collection of big ideas and inspiration. They wanted timelines and specifics.
That tension between the founder’s optimism and the team’s need for clarity is something I’ve seen in almost every startup I’ve invested in since.
And here’s the problem: in startup culture, optimism usually wins the room. Not because it’s more accurate, but because it’s more comfortable. Nobody wants to be the person who kills the energy. Nobody wants to be the one who says, “Actually, this number is wrong.”
So people massage the data. They show the better side of their work. They frame bad news in the most optimistic light possible.
And the founder, because they need the momentum to keep going, often lets it happen.
I know. Because I did.
What “Massaged Results” Actually Cost You
In big companies, there’s a well-known dynamic: people are encouraged to make things look good. Make the boss look good. Present the upside. Bury the downside in the appendix.
In a startup, you cannot afford this.
If you’re constantly massaging the data to show things are going better than they are, you become a victim of your own false reality. You can’t improve what you refuse to see.
I watched this happen at ContentCal during a period when, externally, everything looked like it was flying. ARR was climbing. We were landing notable customers. The brand was growing. But internally, we were chasing too many customer types at once, agencies, SMBs, enterprise, and nobody wanted to be the one to say it wasn’t working.
Why? Because saying “this isn’t working” felt like disloyalty to the vision. It felt like pessimism. And in a startup that runs on optimism, pessimism is treated like a virus.
But the brutal fact was: we were spread too thin. And it took longer than it should have for that truth to surface, because the culture rewarded optimism over honesty.
That delay cost us time, money, and energy we didn’t have.
The Hardest Lesson: You Can Be the Problem
Here’s something I don’t see enough founders admit.
Sometimes the reason nobody tells you the truth is you.
Not because you’re a bad leader. But because you’ve unintentionally built a culture where your optimism, your energy, your conviction is so strong that people feel they can’t challenge it without challenging you.
I had to confront this about myself. At ContentCal, I had to learn that sharing my optimistic vision wasn’t the same as creating clarity. That saying the same thing over and over again, which is essential for alignment, could also create an environment where people felt they couldn’t push back.
One of my senior leadership team taught me something at 28 years old that I’ll never forget. He told me I needed to learn to deal with “constant ambiguity.” I’m embarrassed to say the word had never even registered with me before.
He meant operating under conditions where two contradictory things are true at the same time: we need to go faster and we don’t have the people yet. We’re growing and we’re running out of cash. The deck says we’re winning and the product isn’t working for a chunk of our customers.
That constant ambiguity, the ability to hold both truths without collapsing into either pure optimism or pure panic, is what I now believe to be the core skill of founder leadership.
And it only works if your team is allowed to bring you the second truth. The uncomfortable one. The brutal one.
The Optimist Meets the Pessimist
Early at ContentCal, one of my senior leadership team was a natural pessimist.
It was genuinely strange to me. I’d never worked closely with someone who defaulted to seeing what could go wrong. Every situation was a crisis. Every setback was existential. I remember thinking: how can someone operate like this?
But here’s what that dynamic taught me, and it connects to one of the most important brutal facts in any startup: you have to focus on the right customer.
When you’re early, it’s tempting to say yes to everyone. Every lead feels precious. Every potential customer type looks like validation. We were chasing agencies, SMBs, and enterprise all at the same time, and the optimist in me saw opportunity everywhere.
The pessimist on the team kept pushing back. “This isn’t working. These customers don’t convert the same way. We’re spread too thin.”
It was uncomfortable to hear. But it was the brutal fact.
Focusing on the right customer, really committing to one core segment, is one of the hardest decisions a founder makes. It feels like you’re shrinking the opportunity. It feels like leaving money on the table. But the reality is, you can’t serve everyone well when you’re a small team with limited resources. Trying to is the fastest way to serve nobody well.
That pessimist forced me to confront what I didn’t want to see. And over time, I realised the dynamic wasn’t friction. It was balance. The optimism kept us moving. The pessimism kept us honest. Together, they produced something closer to clarity than either could alone.
The best teams aren’t all optimists. The best teams have people who are willing to name the brutal facts, and a culture that makes it safe to do so.
Why Safe Spaces Aren’t Soft. They’re Strategic.
Creating a safe space sounds like a wellness initiative. It’s not.
It is the single most important cultural infrastructure a founder can build.
Here’s what I mean by it in practice: your team must feel comfortable sharing what is not going well, without fear of punishment, lack of promotion, or political consequences.
If your sales lead can’t tell you the pipeline is weaker than the dashboard suggests, you’ll make hiring decisions based on fiction. If your product lead can’t tell you the feature you’re obsessed with isn’t working, you’ll burn a quarter on something nobody wants. If your finance director can’t tell you the burn rate is unsustainable, you’ll run out of cash before you see it coming.
I learned this the hard way.
In my agency days, I nearly let the business die. Over a two-month period, around £250,000 in invoices went majorly delayed. Clients owed us the money. It was all legitimate, all expected. But the payments just stopped landing. The bank balance shrank week by week, and all I actually needed was a £25,000 float to get through the month until they all got paid.
But I told nobody. Not our investors, not my team.
Not because I was brave. Because I was afraid of the embarrassment of admitting I’d let it get that bad.
That fear of embarrassment almost killed the business.
Eventually the invoices came through and we survived. But the lesson hit hard. After that experience, I changed. The next time things got difficult, I went straight to our investors and asked for help. We secured loans. I vowed never to let pride get in the way of survival again.
The brutal facts don’t destroy companies. Hiding from them does.
The Finance Director You’ll Learn to Love
Let me tell you something about finance directors in startups.
They will infuriate you.
They will say everything is impossible. They will pour cold water on your most exciting ideas. They will tell you the numbers don’t work when you can feel the momentum building.
I used to hate this. It felt like they were blocking progress, dragging us down with their caution.
But over time, I learned to appreciate them deeply, because they were the ones confronting the brutal facts when nobody else would. They were the ones asking the tough questions that, if I’d asked them myself, would have saved me months of wasted effort.
The best teams I’ve built since ContentCal, including what we’re building now at JAAQ, have this dynamic baked in deliberately. I now hire leadership teams with a balance of optimism, realism, pessimism, challenge, and energy. Not everyone in the same gear. Not a room full of people who agree with me. A team where the tension between these perspectives is the thing that produces clarity.
Optimism from the founder. Brutal honesty from the operators. Challenge from the board. And a culture where all of it is not just tolerated but expected.
What It Looks Like When You Get It Right
When confronting the brutal facts becomes a rhythm, not a crisis, everything changes.
At ContentCal, there was a turning point. We were chasing multiple customer segments and the numbers looked fine on the surface. But when we finally sat down with the real data, not the investor deck data, the actual unvarnished numbers, the picture was clear. One segment was converting. The others were draining us.
We made the call. We cut the segments that weren’t working and went all in on SMB SaaS.
That decision felt like shrinking. It felt risky. It felt like the opposite of the big vision I’d been selling.
But it was the decision that unlocked everything that followed. It focused the product. It focused the team. It made the story clearer for investors. And ultimately, it’s what led to the acquisition by Adobe.
That decision didn’t come from optimism. It came from looking at the brutal facts and having the guts to act on them.
The optimism came after. When we could see it was working.
From Company Rot to Company Clarity
When you don’t confront the brutal facts, something else happens.
I call it company rot.
It starts when someone who shouldn’t be on the team stays too long. When performance issues go unaddressed because the conversation feels too hard. When results get massaged week after week until the gap between reality and narrative is so wide that the team stops trusting the narrative altogether.
Company rot is quiet. It doesn’t announce itself. It shows up as declining morale, slower execution, good people leaving without clear reasons, and meetings that feel increasingly hollow.
I’ve experienced the highs of team morale, those incredible “let’s go” moments where everyone is aligned and moving fast. And I’ve witnessed what happens when rot sets in. It can bring an entire organisation to a standstill, because people don’t want to work in an atmosphere built on fiction.
The antidote is simple but painful: hire slowly, fire fast, and make the hard calls with conviction. Not cruelty. Conviction. There’s a difference.
And when you do make those calls, when you confront the fact that someone isn’t working, that a strategy isn’t landing, that a product bet was wrong, communicate it clearly. To the individual and to the team.
Nothing builds trust faster than a leader who says: “Here’s what I got wrong. Here’s what we’re doing about it. Here’s where we’re going next.”
The Line That Separates Companies That Scale From Companies That Stall
The founders who win are not the most optimistic.
They’re the most honest, with themselves and their teams, while maintaining belief that the problems are solvable.
The companies that break through the messy middle are the ones where the leadership team can sit in a room and say, “This is where we actually are,” without anyone getting fired for honesty.
The best cultures don’t eliminate tension between optimism and realism. They make that tension productive. They create a rhythm where brutal facts are surfaced, acknowledged, and acted on, without destroying the energy that keeps everyone moving forward.
And here’s what I know for certain after doing this for over a decade:
The founder’s job is not to have all the answers.
It is to build a room where the answers can surface. Even the ones you don’t want to hear. Especially the ones you don’t want to hear.
That’s what Good to Great actually looks like inside a startup.
Not a framework on a whiteboard.
A daily practice of choosing clarity over comfort.
And it starts with one question most founders are afraid to ask their team:
What are we not talking about?
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