You Cannot Learn All You Need to Know on the Internet

The internet is a phenomenal resource, but it can be hard to figure out exactly what applies to your startup because so many variables influence how to combine elements into a cohesive solution. Remember that you cannot learn everything you need to know to build a startup online.

The internet is such a fantastic wealth of resources. Still, lately, I keep running into younger (keep in mind that people in my generation can remember when the internet wasn’t even a thing yet!) first-time founders who are using their spectacular search skills to learn as much as they can as they seek to build their startups. But…sometimes, it becomes quite evident that they do not know the right questions or are unaware of the context of when specific solutions are appropriate. The consequence can be that they look inexperienced when they apply something they spotted on the internet inappropriately, so I thought I would suggest some guidelines for when to lean into the internet and when to double-check what you are learning with an experienced founder-mentor or three.

When the Internet is Great

The internet (and the generative AI large language models like ChatGPT that have used it as a training set) is excellent when it comes to:

• Getting a general sense of a topic, industry, or competitive space. As you seek to get the lay of the land in a particular area, searching on keywords can help you explore and begin to learn the vocabulary, concepts, and players in particular spaces. For this kind of background work, I often keep searching and clicking through to get exposed to a particular topic. For example, recently, I was looking for some fodder to describe a marketplace and searched “different types of hospitals,” which led to an exploration of ways to categorize hospitals such as size, ownership, geographic location, types, specializations, funding sources, and various other dimensions that could be used to describe hospitals. Another time I was exploring different types of databases. Basically, the key is that I was not looking for a single fact but was roaming around trying to get a sense of the space. The structure of the internet can make this a fast and fruitful learning exercise.
  
  
• Screening those with business websites, such as VCs, potential business customers, and competitors. If you are trying to learn about a particular business to, say, determine if they are a fit for your startup, the internet can provide a wealth of information. Start with their website, LinkedIn profile, news articles, or other published material to find out what they say about themselves. If a potential target describes what they are doing or what types of startups they invest in, you can often triage potential targets based on what they say about themselves.
  
  
• Accessing published reference information. Often startups are looking for referenceable material to bolster their case. Searching the patent database, medical journals, published research, and government databases can give you third-party referenceable statistics and other information to help build your market analysis and go-to-market plans. This will help you target information to sharpen your sales effort.
  
  
• Basic startup terminology and entrepreneurial toolkits. There is information out there that can help with definitions, outlines, and templates. These have often been assembled by those (like me!) who want to help others along their startup journey – and it is certainly easier and faster today than it was twenty years ago to get introductory information about many topics.

When the Internet is Just A Starting Point

So, let us agree that the internet is a powerful tool, but remember that AI hallucinations (when AI tools “make stuff up”) are a thing, and judgment and experience are essential for sifting through all the information available and determining how it applies to the specifics of your startup. Here are some examples that I hope will illustrate when you should make sure to be tapping into the experience of those who have built startups before or those who are professional advisors (like corporate attorneys) whose expertise can help you navigate the specific nuances of the situation(s) you are trying to navigate:

• Customer discovery. The internet can be an excellent resource for learning about the general needs of a particular potential target customer group. However, if you are innovating, you likely won’t find an article or post specifically laying out the particular unmet need you are trying to address, nor how your novel solution might address it. For this, you need to talk to people who might be your potential customers.
  
  
• Contact pages. While every VC will likely have a “contact us” option on their website, a warm introduction from someone they know and trust will get you much greater attention than a cold webpage reach out. It is worth the time trying to screen whom you want to connect with on the internet – and then working your network to try to find someone who knows that group, can fill in some of the missing information about what they are like to work with, and make a warm introduction if it seems like a potentially good fit.
  
  
• Due diligence. Much has been written about investor due diligence and what might be asked for; however, pause before just downloading a due diligence checklist from the internet and populating a data room off of it. Remember you are trying to build a relationship with that potential lead investor – and investors who lead will have their own thoughts (and checklists!) about what they want to see. As you develop their interest enough that they agree to move into due diligence, ask for their checklist and build your data room around that.
  
  While there are some common elements (for example, past funding documents, capitalization table, etc.), it is helpful to NOT put everything and the kitchen sink in the data room because that can be overwhelming and raise distracting questions. Collaborate and customize your data room to address the questions your potential lead investor wants to focus on. Due diligence varies based on the stage, industry, and particulars of the startup, so do not just try to power through with a generic list.
  
  
• Planning. Designing your startup is work that must be customized to your specific opportunity. While there are certain common patterns and rules of thumb, each startup will have its unique special sauce and areas that need to be developed as strengths. The internet can give you ideas and food for thought, but you do not just want to copy someone else’s plan. Your plan needs to be specific to what you are trying to build. The sequencing of tasks, milestones, hiring, and many other factors should be customized based on how they fit together like puzzle pieces to de-risk and build value.
  
  
• Compensation Packages. The internet has benchmarking data about compensation bands, different equity compensation options, and other statistics. However, these guidelines are almost never presented in a cohesive view. You cannot just combine a job title with a median salary with a median equity stake with another graph that shows how these factors evolve over a startup’s stage of development (pre-seed, seed, Series A, Series B, Series C, etc.) and the amount of money raised and get an actionable answer. The data on the internet suffers from the moderating effect of summary statistics, and your compensation of team members will need to reflect individual variables like experience, role, scope of responsibility, amount of money raised, relationship with other team members, industry, and many other factors. There are expectations that need to be considered, resource constraints, and other factors. Compensation is definitely an area to get educated on, given the variety of possible compensation tools available. Be sure to get advice customized to your particular situation from experienced mentors so you are considering what fits now and how it will scale as you grow your startup.

My advice is to be sure to test your assumptions and understanding based on internet research with wise advisors who are willing to help you learn and sort it all out. There are experienced people out there who remember what it was like to be confused and uncertain and are willing to lend a hand. Educate yourself as much as possible – and then test your thoughts and ideas before committing to them fully or exposing your incomplete understanding to the investors you are trying to impress.