Every entrepreneur knows the stories of successful founders who started in a garage. William Hewlett and David Packard produced electronic test equipment, Steve Jobs and Steve Wozniak built computers, Jeff Bezos sold books, Larry Page and Sergey Brin created a search engine.
Office space is the last thing on an entrepreneur’s mind in the bootsrapping stage–because every penny needs to go toward getting one more customer or making the product that much better, not on finding an office with exposed brick and natural lighting.
We talked about these literal and figurative garage days in the latest episode of the Zero to IPO podcast. We spoke to founders and executives from Box, Frontier Communications, Eventbrite, and Domo, who discussed how scrappy approaches helped them get off on the right foot. Here’s what they learned:
1) You have to go all in
Aaron Levie, CEO and cofounder of Box, didn’t start his enterprise cloud storage company in a garage–he began in an attic. It was there that Levie and his cofounder Dylan Smith tried and failed to raise funding. One day, they cold-emailed Mark Cuban–and he responded. Cuban invested over $300,000, which motivated Levie to go all in. He dropped out of college and, with some prodding, convinced Smith to do the same by asking a straightforward question: “If this billionaire believes in us, who are we to say that we can’t do this?”
Eventually, they ditched the Seattle attic for a cottage in an uncle’s backyard in Berkeley, which then grew into a garage and ultimately an actual office. Levie won’t romanticize the experience. To him, the garage isn’t a mandatory stop along the entrepreneurial journey. “No one should ever aspire to live in a garage,” Levie says. For him, it was a way to save money and an indicator of his readiness to go all in.
2) Learn to negotiate early and often
Regardless of where they start, founders need to have conviction and the ability to negotiate. That’s what Maggie Wilderotter, former CEO of Frontier Communications, learned at a young age.
Wilderotter was a teenage member on the Long Branch, New Jersey, City Council, representing her local public schools when the city organized an event for local Vietnam War veterans–and she invited then-President Richard Nixon. She wrote a letter to the president, including four tickets to the benefit dinner and waited. Two weeks later a White House staff member called her at school to say that President Nixon and the First Lady wouldn’t be able to attend. Young Maggie adjusted her strategy on the spot: Can the vice president attend? “No.” Understood, so should we expect a financial contribution for the tickets instead? After a pause, “Why, of course!” Since Wilderotter was convinced she had a good idea, she didn’t stop after the initial rejection. Her conviction and negotiation skills helped her find another alternative: significant donations to the veterans’ families.
3) Reframe disappointment as opportunity
Julia Hartz, CEO of Eventbrite, was working in TV development when she decided it was time for a change. She joined her then-fiancé in the Bay Area and started interviewing for jobs. A startup cable company gave her a lowball offer, which she says was the best thing that could have happened–because it made her pause. During that pause, Hartz realized she and her husband-to-be had an opportunity to start their own company. They just needed to decide where to start.
The Hartzes pooled their savings and set up shop in the corner of a warehouse her uncle owned (with all the Cup-O-Noodles you could imagine) to build Eventbrite. By 2008, the company raised its first round of funding. Hartz credits her disappointing job offer with inspiring her to transform an idea into an event platform.
4) A little confidence goes a long way
The day after Josh James sold Omniture to Adobe for $1.8 billion, he didn’t know what to do. He knew how to build startups and how to leverage data to help enterprises be successful. With Omniture acquired, he was unmoored. Everyone encouraged him to take a vacation. But after literally one day off, he was restless and couldn’t get an old idea out his mind, so he decided to start a new company: Domo.
Domo doesn’t have the markers of a typical garage story–having already sold a company, James had the resources to acquire an existing graph and charting engine startup, which he then molded into his vision. But in his figurative garage, he relearned the importance of having confidence in an idea, and yourself. As he put it, “If someone’s gotta be on top, why not me?”
5) Stick to the main thing
Talking with these entrepreneurs about their garage days reminded me of Okta’s start: We were working from borrowed desks at Jawbone’s office, overlooking the San Francisco dumpster painting yard. But it didn’t matter because we focused on the work, not the view. It was all about getting momentum.
I had a poster over my Okta desk for years that featured a quote attributed to Stephen Covey: “You have to keep the main thing the main thing.” It hangs in my garage today, reminding me that at some point–whether you’re in a garage, a backyard, subleased corner of a warehouse, or at your home computer–you have to define your “main thing” and then devote everything you have to bring your idea to life.
Frederic Kerrest is the COO and cofounder of Okta. You can listen to the full episode, “The Garage Days” wherever you get your podcasts. Tune into Zero to IPO every Tuesday and check back here each week to read about the discussion on each episode.