Pando

It’s easier than ever to sell your soul

By Francisco Dao , written on June 4, 2013

From The News Desk

About a year and a half ago, two friends of mine, we’ll call them “Sam” and “Tommy,” decided to sell their souls to start funded Internet companies. They didn’t know they were selling their souls of course, and it seemed like a good decision at the time, but I had a hunch. Sam was busy with his young family, so I didn’t get a chance to tell him my concerns, not that it would have made a difference. But I did tell Tommy and, as always, he ignored me, because I wasn’t an Internet entrepreneur.

I knew all about selling my soul, because I had done it many years before. During my 20s, I jumped on every opportunity I thought would make a buck and worked with some very smart, but very unscrupulous business partners with the belief that the end would justify the means. We had some moderate success, but ultimately I would get royally screwed and be left holding the bag. Needless to say, the end did not justify the means. I had sold my soul for nothing.

As I look around the startup space today with its seductive hype and easy angel money, it seems easier than ever to sell your soul. The entire ecosystem is essentially screaming the devilish message, “Join us. Sign on the dotted line, and internet riches can be yours.” Incubators and investors who wave loaded offers in front of desperate and uninitiated entrepreneurs are practically a pawn shop for souls. Empty bank account? Maxed out credit cards? We give you cash and false hope in exchange for your soul here at Incubator ABC.

The offers are difficult to resist, but if you make a bad bargain, you may quickly find you’re no longer in control of your company or forced to peddle some ridiculous product, because your investors think it’s the best way for them to get their 10-times return. You’ll keep telling yourself that this is the road to riches, and you just need to keep pushing and growing revenue at all costs. The investors know what they’re doing, right? They’re your friends. The end justifies the means. Even though you’ve been diluted down to 5 percent, you do the math and think, “Even a $30 million dollar exit is $1.5 million in my pocket.”

Then, when the shit hits the fan, and the seed money (along with your soul) are gone, you look around and realize you’ve compromised everything you held dear while they moved on to new souls they’ve collected.

I’m not suggesting that all investors and incubators are evil. In fact, I generally defend the venture capital industry. The decision to sell one’s soul falls strictly on the entrepreneur. It’s up to you to resist the lure of a bad deal that you think might be your golden ticket. The end doesn’t always justify the means, and selling your soul isn’t different or okay, just because you’re doing it for an Internet company. That was Tommy’s mistake. He didn’t listen to me, because I had sold my soul in a different time for a different kind of business. He didn’t realize that selling your soul is always the same.

The good news is even if you sell your soul, you can get it back, albeit painfully. Sam is out of his company now, forcibly removed and starting over. Before selling his soul for what he thought was his big break, he had successfully bootstrapped and exited a couple of small businesses, so I have no doubt he will be back better and wiser for it. I’m sure he’ll never sell his soul again. Tommy is still trying to make the best of a bad situation. I think he feels bound by honor. That’s how they get you. The unscrupulous will always play on the honor of more decent men.

Much like I learned 15 years ago, Sam and Tommy had to learn the lesson for themselves. I guess that’s why the business of buying and selling souls never dries up. There’s always someone trying to buy and, since you never realize you’ve sold your soul until it’s too late, there’s always someone willing to sell. Don’t let it be you.

[Illustration by Hallie Bateman]