Dan Oshinsky is a 2011-12 Reynolds Fellow, and the founder of Stry, a news service launching in Spring 2012. Here on the RJI blog, Dan's putting himself inside the fishbowl to document a year in the life of a startup. Dan hopes that by being transparent with the process, others can learn from his successes, mistakes and failures.
It's not easy trying to describe the nature of a start-up. There are no easy analogies. I mean, really; How do you explain something that involves risk, chance, ambition and wealth, all of which have to operate in harmony?
Typical metaphors won't do for such a situation. You'll hear start-up founders call the start-up process a little like running a marathon, like skydiving without a parachute, like steering a runaway roller coaster.
None of those embody the full complication of a start-up. They ignore all the holes -- all the bumps in the road that could derail and destroy a start-up.
But I was home one day this summer, watching HBO, when I found the thing that does a weirdly accurate job explaining the nature of start-ups.
I'm talking, of course, about the movie "Ocean's Eleven."
TESS: Do you remember what I said to you when we first met?
DANNY: You said, 'You better know what you're doing.'
TESS: Do you? Now? Because -- truly -- you should walk out the door if you don't.
DANNY: I know what I'm doing.
Okay, okay, it's a ridiculous sounding analogy. But bear with me, here. "Ocean's Eleven," at its most basic level, is the story of two guys with big ambition who risk their livelihoods to find funding and build a team in order to chase an enormous payday.
Doesn't that sound a little like a start-up?
Take it a step further. A good start-up needs to answer a few basic questions, like:
- Who are the founders?
- What do they do?
- How do they make money?
- Do they have substantial funding in place?
- Do they understand the risk involved?
- Do they have the right team in place?
So, one at a time -- and, for the record, I'm assuming that you've actually seen this movie before, and you almost certainly have, seeing as how it grossed $450 million and is on TV, like, constantly -- here's how "Ocean's Eleven" answers:
Who are the founders? They've got two. Danny Ocean (played by George Clooney) is the visionary, the CEO. He's the dreamer behind this project. His no. 2, his co-founder, is Rusty Ryan (Brad Pitt). They've worked together on big jobs before, they're experienced in the world of robbery, and it's clear from the start that they're well connected. Most importantly, it's clear that they trust and are willing to call BS on one another. If this was Silicon Valley, these would be the guys who just won big with their last start-up and are now going for an even bigger fish.
It also doesn't hurt that these guys are completely fearless.
What do they do? They're thieves, and they're going to rob three of the biggest casinos in Las Vegas. It's ambitious, yes, but Danny's even got the elevator pitch down. (Ironically, he delivers the elevator pitch to Rusty while waiting for the elevator.)
Why do this? He tells Rusty:
"Because the house always wins. You play long enough, never changing stakes, the house takes you. Unless, when that special hand comes around, you bet big. And then you take the house."
That's everything right there. The stakes. The risk. The opportunity. All in 30 seconds. It's a dream elevator pitch.
How do they make money? They steal it.
But that leads to a second, related question:
Is there a lot of money to be made in this field? And the answer is a resounding "yes." There's $160 million to be made, says Danny.
Do they have substantial funding in place? The first place Danny and Rusty go? It's to Reuben Tishkoff (Elliott Gould), a Vegas-based mogul with, A.) Money to burn, and B.) An axe to grind. He's not just the angel investor to end all angel investors; he's also the guy who invented the concept of hotel security. So he's the guy they need as an advisor.
Do they understand the risk involved? Oh, yeah. They're stealing from Terry Benedict, lord of the Vegas Strip, and they know what happens if they screw it up:
REUBEN: You gonna steal from Terry Benedict, you better goddamn know. This sorta thing used to be civilized. You'd hit a guy, he'd whack you. Done. But Benedict... At the end of this he better not know you're involved, not know your names, or think you're dead. Because he'll kill you, and then he'll go to work on you.
DANNY: That's why we've got to be very careful. We have to be precise.
REUBEN: Yeah, you gotta be nuts, too. And you're gonna need a crew as nuts as you are. Who do you have in mind?
Do they have the right team in place? They're building it, through connections and networking. It's evident that they already know the types of people they'll need:
RUSTY: You'd need at least a dozen guys, doing a combination of cons.
DANNY: Like what, you think?
RUSTY: Well, off the top of my head, I'd say you're looking at a Boesky, a Jim Brown, a Miss Daisy, two Jethros, and a Leon Spinks. Oh, and the biggest Ella Fitzgerald ever.
And as they're building the team, Danny and Rusty act like good co-founders and talk about what they've got and how much more they need to pull this off.
It's also important that they convey to their team exactly how complicated this plan could get. Which is exactly what they do:
DANNY: Okay. Before we start, nobody's on the line here yet. What I'm about to propose to you happens to be both highly lucrative and highly dangerous. If that doesn't sound like your particular brand of vodka, help yourself to as much food as you like and safe journey. No hard feelings. Otherwise, come with me.
So that's the base for this new, slightly-more-illegal-than-your-usual-start-up. But it's definitely a start-up. It's got all the trappings -- the founders, the dream, the funding, the risk, the team.
Next step: The early stages.
DANNY: You gotta walk before you crawl.
RUSTY: Reverse that.
This is the part that the movie kind of glazes over. But what's happening behind the scenes: Ocean's team is putting together their market research. They're studying the casino, learning the secrets, getting the framework for their launch date in place. They secure office space, and they start burning through cash. They know when this whole plan has to go live. They have an actual launch day.
Most notably is that they have a to-do list, that list of actionable events they need to put into motion to get their company moving, and they set about knocking stuff off that list.
All good things.
SAUL: "I don't believe in weakness. It costs too much."
Now, here's the part that really resembles the life of a start-up. Remember the holes I mentioned earlier? You pick a poor co-founder and the entire thing blows up. You put money in the wrong places, and the whole thing blows up. Your product doesn't work, and the whole thing blows up.
In the movies, they call this "plot." In a start-up, they're the things that sink a business.
And "Ocean's Eleven" is full of the holes that could end a start-up.
Think of it this way: When Danny Ocean is dreaming up this robbery, there's a simple list of things he's worried about: money, team, timing. But as the we-go-live day approaches, things get more and more complicated. The 'What Ifs' pile up. The number of holes multiply.
Now, in "Ocean's Eleven," the holes don't sink their plan. Danny and Co. rob the Bellagio, the Mirage and the MGM Grand. They make their money. Lots of it.
But by my count, there are 39 -- THIRTY-NINE! -- things that happen during the execution of their plan that could completely torpedo the project. Thirty-nine things that, if they had gone wrong, would have cost the team $160 million, and possibly their lives.
The thirty-nine include times where costumed members of the team are nearly discovered as frauds, times members of the team nearly get arrested, times that a key piece of technology doesn't work exactly as planned, times a small Chinese man keeps a briefcase from setting off alarm sensors, times casino security weirdly is unable to realize that a decoy van is being driven by a robot, etc. Basically, there's a lot of stuff that can go wrong, but only four things really do:
1. Basher Tarr (Don Cheadle) has a plan to cut out the power in the casino, but the electric company fixes the glitch that he was going to exploit. The team then drives to California and steals a different piece of equipment that is also capable of blacking out Las Vegas. Problem: solved.
2. Danny gets red-flagged by the casino and can't do his job. Linus Caldwell (Matt Damon) steps in to do Danny's job (although Danny ends up participating in the heist anyway). Problem: solved.
3. Saul Bloom (Carl Reiner) gets recognized by a friend from Florida. The friend is taken away by security, and Terry Benedict doesn't get suspicious of Saul. Problem: solved.
4. The batteries for the bomb detonation device are dead. Linus has replacement batteries. They replace the batteries and set off the bomb. Problem: solved.
And that's it. Thirty-nine near mistakes in the movie, and four things go wrong. And all four get fixed. Essentially, everything that can go right does. The start-up plan is perfect, the pre-launch work is perfect, and the execution on launch day is perfect. When things go wrong, the team is able to adapt on the fly and avoid the holes that could sink the project.
Of course, this is the Hollywood version of what happens with a start-up. Danny Ocean's Eleven succeeds in a huge way. Each of the crew makes out with $10+ million. Reuben probably pulls in four times that. Not bad for his investment in a scrappy crew of dreamers and ex-cons.
RUSTY: So here's what I think: You should take this plan, kick it around for a week or two. Sleep on it. Turn it over in your head. Then: never bring it up to me again.
DANNY: Uh-uh. So what are you saying?
RUSTY: I'm saying: This is like trying to build a house of cards on the deck of a speeding boat.
DANNY: Really? I thought it was much harder than that.
That dialogue you just read? It's in the in the original "Ocean's Eleven" screenplay, but it ended up on the cutting room floor. Turns out that even the Hollywood guys couldn't think of a good action-based metaphor for what they had going on.
Which brings me back to what kicked off this post: What's a start-up really like? It's a little like "Ocean's Eleven," just without the guarantee of the Hollywood ending.
Also, probably less Julia Roberts. Probably.