Is Starting a Company Risky: Part I

Advice from Justin Beck, Co-Founder and CEO PerBLue
One of the things I hear again and again from my friends and peers is: “Justin, I admire your bravery and ability to take the risk and start a company. I could never do that.” Initially I thought they were right, but my experience has given me a different perspective. What I’ve learned is that the risks and sacrifices you’ll have to make are worth it in the end. In this two part blog series, I’ll discuss the risk and sacrifices involved in starting a company.justin beck

In the beginning of a company’s story, you will be forced to sacrifice some nice things and take some great risks in the name of success for your business. Most people see starting a company as a risky endeavor because they automatically assume that there will be failure. If you start a company from the viewpoint, “we have to succeed” failure is a lot harder because you really don’t want to fail.

This attitude will allow you to make different and better decisions because you really don’t want to clean up the mess. This alone will eliminate a lot of risk. Conservative cash utilization, being pragmatic, and working on something you really believe in are some of the results.

Another interesting and often overlooked aspect is that the sacrifices necessary to building a startup aren’t actually that expensive. Here’s my view of some of those sacrifices, and how they can be justified.

Time:By far one of the largest costs. However, when you compare the ROI of your time spend in an education and experience point of view, you will easily be getting 2 times the value by working on a new venture. Many people throw away countless days of their life idling in useless actions, or at jobs they don’t like, doing work that doesn’t have a larger impact on society. As an entrepreneur starting a new company, you could potentially spend years building your business. So my question for those who feel like they have wasted years of their lives, running on the corporate treadmill — if you we’re able to spend those years on any mission or problem you want, what would you pick? If it’s what you are doing now, then great! If not, start a company to meet that need. That way, you will never feel like you “wasted those years away.”

Personal Cash Flow:Money is another big sacrifice. People at different life stages will have varying levels of sacrifice. For example, individuals with spouses, kids, and a house have much more cash burn than a younger single person. The real key is to try to keep costs very low so that you can accumulate cash. This is something I did accidentally. With this bootstrapping mindset you can make career choices not solely based on compensation. In a startup your income will be significantly lower in the beginning. However, your ‘earning potential’ will grow substantially from the experience that often comes from ‘wearing many hats’ at a startup.

Check back next week for two more risks associated with starting your own company.

Guest post from Justin Beck
Justin Beck is the Co-Founder and CEO of PerBlue, a mobile and social gaming company in Madison, Wisconsin. The company is best known for its flagship product, Parallel Kingdom, the first location-based RPG. Justin is a passionate software developer and entrepreneur. As CEO, Beck has grown PerBlue from a group five college friends to a team of 30 full-time employees.

Prior to starting PerBlue, Beck held software engineer and program manager positions at Microsoft and Google. Beck graduated from the University of Wisconsin with degrees in Computer Engineering and Computer Science.

About Guest Blogger

Guest bloggers for the TDS Business Blog.



  1. Is Starting a Company Risky? Part 2 | TDS Business - January 17, 2013

    […] with starting a company. If you didn’t have the chance to read that post, you can find it here. Today, I’ve put together a few more thoughts on starting a […]

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