Idea to Startup: Giving Your Startup an Identity

Podcast | Youtube

Sponsor: Tacklebox Self-Paced Program

Go through a proven, step-by-step process to vet your startup idea at your own speed. You’ll gain the Tacklebox equivalent of an MBA in entrepreneurship with the skills to validate any idea you have in the future.

Two week free trial here.

This Episode

Startups are just a decision-making process at scale.

And building that decision-making process gets a whole lot easier when you understand the variables behind a good decision and have a clear identity to help fill in the gaps. That’s what today’s episode is all about.

We walk through a real example from a Tacklebox founder building an AI tool to help adults learn Spanish—and use his customer dilemma to build out a practical, repeatable decision-making framework.

There are two parts of the episode I thought might be helpful to have in writing—the decision equation and the prompts for defining your identity. Both are below.

Hope they help!

1. The Decision Equation

Here’s a framework we use at Tacklebox to help founders think through any major startup decision:

Decision = (Expected Value × Confidence) − (Cost × Risk Aversion)

Basically…

• What’s the upside if this works?

• How confident are you that it will?

• What’s the cost (time, money, energy)?

• How much do you fear losing that cost?

There are also three bonus variables:

• Regret Override — Will you regret not doing this?

• Uncomfortable Override — Is this uncomfortable for a good reason?

• Unfair Advantage — Do you have a unique edge that makes this work for you?

You can run just about any decision through this framework to get clarity around the decision or what else you need to learn. But, identity makes it sharper.

2. Prompts to Find Your Startup Identity

Try this short exercise—four prompts to help define what matters most to you:

1. Write your story — Picture yourself five years in the future, in the best version of your life. What are you doing? What does a Tuesday look like?

2. Proudest moments — When were you happiest and most surprised by yourself? What were you doing? What did it require of you?

3. Non-negotiables — What won’t you sacrifice? What’s off the table, even for money or growth?

4. Healthy envy — Who do you look at and think: “I want that”?

These should help you move towards an identity - the non-negotiables for any project you’re working on.

Pod References

• Tacklebox - we finally have a two-week free trial

• Hero

  
  00:30 Your Startup Identity

  01:30 How to Swim

  04:17 How to Learn Something New

  06:34 Re-learning How to Make Decisions

  08:45 Tacklebox - two week free trial

  09:15 Carl’s Idea - AI for Learning Spanish

  13:13 The Decision Equation

  14:15 Picking a Customer

  19:30 Identity: Your Decision Filter

  21:30 Four Identity Exercises

  24:13 The End: What Do You Want?

Transcript - Feel Free to Read it Like a Long-form Article:

Today, we’re going to talk about how you probably need a startup identity.

This idea has been been sitting, marinating in my podcast drafts like a nice Sunday bolognese. The reason it’s taken so long is that it’s a classic startup chicken and egg scenario - should you show up to your startup with an identity for you and your business, or should the identity be a reaction to the customer and market? Is an identity a rigid thing the startup has to fit into, or vice versa? Sub question…. Is it better to burn out or fade awayyyyy? That’s a High fidelity joke. Great movie.

Anyway, it’s taken a while but I’ve decided that picking an identity and making decisions through that lens is the right approach. Turns out the egg came first. Intentionality around an identity is more likely to work. And not having an identity from the start makes it too hard to make the avalanche of daily decisions you’ll be faced with. So, let’s nail yours down.

And we’ll start by talking about how to learn something new.

—

About eight years ago I decided I wanted to start doing triathlons, which meant I needed to learn how to swim. Actually, my first instinct was that I could probably just figure out the swim thing on race day, but 300 yards out into the ocean swim at my first sprint triathlon I realized I’d made a terrible mistake, and a talkative guy in a very seaworthy kayak had to tow me to shore. He was race volunteer, it wasn’t just some random guy, but still.

After that, I decided to take swim lessons. At the first one, my instructor started by asking me to hop in the pool and swim a lap to see what she was working with. I furiously kicked and churned my arms and exhausted myself like a toddler, clinging to the wall to catch my breath half way through. I sheepishly told her I had to get in better swimming shape.

She smiled and told me to hop out of the pool.

“No, you don’t,” she said. “Swimming has very little to do with your aerobic system. Look at that guy” - she pointed to an 80 year old who was calmly, smoothly swimming lap after lap.

“Swimming is about two things - drag, and your nervous system.”

She continued.

“When you swim freestyle, you never want to be on your stomach. That all but guarantees that your legs will slump down behind you like a manatee. It’ll create enormous drag and make the whole experience miserable. Think about when you put your hand out the window of a car - if you keep your palm parallel to the ground, it cuts through the air easily. But if you stand your palm up, you feel enormous resistance. Swimming is just like that, except that water is 800 times denser than air. You can’t have any drag. The problem is that the only place you’ll be comfortable in the water when you start is on your stomach. It feels stable. So that’s how nearly every beginner swims, and that’s why its so exhausting.”

She went on.

“You’ll have the least amount of drag when you’re completely on your side, with your arm extended fully and your legs extended fully, like a human canoe. That’s the position you want to spend all your time in. And the goal is to minimize your strokes, not maximize them, because every stroke takes you out of that canoe position. Rotate from side to side, and glide as long as you can. That’s how you swim fast and far.”

This was blowing my mind. She continued.

“The problem is that your nervous system won’t feel comfortable on your side gliding. It’ll panic and think you’re drowning and try to roll you onto your stomach. So, we need to train your nervous system - get it comfortable being on your side in the water. Once it is, you can learn to swim. The first month of lessons are just drills to get you comfortable being on your side.”

And, after a month of those drills, it clicked. My nervous system relaxed. I swam on my side. And swimming a mile became about as much effort as jogging one.

—

Learning something new is a skill we perfect as kids, but it usually atrophies by the time we’re like 24. That’s roughly when everything in life feels like it switches from being focused on things you can learn to things you already know. You interview for jobs you can already do, and people hire you to keep doing that thing you’re already pretty good at. Being a novice is seen as bad.

And I get it. If I’m hiring someone to handle Tacklebox’s SEO, I’d like for them to know how to do it already.

Unfortunately, this is a terrible way to live. Optimizing on what you learned in the first 5% of your career for the next 95% is an enormous waste of potential. And once you’ve gone a few years without learning anything new, it gets intimidating going back. Plus, our whole world is now organized around people publicly pretending they’re experts about everything. I dare you to spend 5 minutes scrolling through linkedin without getting violently ill.

Add it all up and you have a bunch of people who either don’t try new things or pretend they’re experts when they do.

But the best thing you can do is to learn new things and recognize when you’re a total novice and embrace it. Being a novice is freeing. There are no expectations - just the opportunity to learn. All of our most successful founders showed up at Tacklebox like little sponges, eager to tell everyone what they don’t know so that they can start chipping away at it. This creates a steep growth curve.

The key to learning something new when you’re a bit older is a great teacher. There’s some weird cache around being self-taught, but most people going that route are only doing it to avoid taking any responsibility for actually learning a thing.

I always suggest over-investing in teachers and coaches to put yourself on the hook. Great teachers will break down a very complex thing into a handful of approachable, foundational, often counterintuitive blocks that create disproportionate value and momentum. Blocks you can practice.

If I hadn’t gotten a swim coach, I would’ve just assumed my problem was endurance, and I would’ve exhausted myself in the pool, swimming on my stomach like a manatee, literally never getting anywhere.

With a coach, I learned about the nervous system and about drag and ways to navigate both and made progress.

For startups, a similar type of counterintuitive foundational block you need to practice is decision making. You need to re-learn how to make decisions.

This might sound silly - you make decisions every day - but the sheer volume, consequence, and ambiguity of the decisions you need to make as an entrepreneur will shock your system. You’ll never have enough information to comfortably make these decisions, which means decisions start to look more like bets. You identify the potential benefit and the cost and move forward. This uncomfortable decisions will include everything from what idea to choose to what customer to pick first to how much to charge to features for an MVP to outsourcing development or trying to hire to whether you make your own website on squarespace or get a freelancer to the copy you write to SEO to branding to time and money allocation and thousands more. Should you name your new sub shop I can be your hero baby? Does anyone even still remember enrique iglesias?

Note - free coaching session to the first person who emails with the name of the actress in that music video. It’s millennial bingo. No cheating.

Anyway, startups are a decision making process at scale. If you make consistent, coherent decisions - fast - you’ll make progress.

Best of all, you’ll have a brand and a company culture because those are the side effects of a predictable decision making strategy that’s moored to something bigger. Each - brand and culture - are just when people know exactly what to expect from you.

And the cheat code for consistent decisions is a clear identity. A lens you can apply to every situation that’ll make it way easier to stack decisions that build momentum towards something.

You won’t survive if you make every decision in a vacuum. A clear identity will make most decisions obvious - or at least give you a great starting point. It’ll let you move fast.

It’s easier said than done and almost certainly not something you’ve done before.

So, hey, let’s get into it.

Let’s talk about the variables in the decision equation, let’s talk about identities, and let’s help you define yours. All with a little help from Carl, a guy helping adults learn new languages.

After.. a little smooth jazz.

Hey!

If you’ve considered Tacklebox but thought - man, I’d like to try this thing first… great news. We’ve finally got a two week free trial for our self-paced program. Pop in there and see what our content and the flow is all about. Force yourself to do some interviews. Make some actual progress on your idea. You can stick with the self-paced program after the two weeks or apply to move into the small group program and get coaching.

check it out at gettacklebox dot com.

Back to it.

Carl and The Decision Equation

These pods always work best when we pair them with an example. So, today, we’ll use a founder new to Tacklebox who was a happy guinea pig. We’ll call him Carl. That’s not his name but it isn’t all that far off. He chose it because he said that was the name his parents had originally planned. That won’t be on the test.

Carl is working on an AI startup - shocker - that’s helping adults learn other languages, starting with Spanish.

The idea is simple: A conversational AI tool that has free-flowing conversations with learners, then generates digital flashcards and develops lesson plans based on their specific needs.

So, if you wanted to learn Spanish, you’d fire up the app and it’d ask you a question - like, how was your day. You’d answer, first with what you wanted to say in English, and then with your attempt at Spanish. It’d then correct you if necessary, and ask a normal follow up question. After a 10-15 minute chat, it says goodbye and writes up a report. It recognizes where you’re struggling and creates flashcards you can look at throughout the day to drive words or concepts home. That night, you jump back into the conversation, and it’ll remember the stuff you need to work on.

Now, obviously, this is a product idea. This isn’t problem based or customer based - it’s something cool the founder thought might work because he lives and breathes AI and spent a year frantically learning Spanish before living abroad. And that’s why I liked it as an example. It’s probably pretty close to what you’re thinking about.

Now, back to decisions.

When I asked Carl what decisions he wanted to run through this framework, he was a bit caught off guard. What do you mean, decisions… he said.

“Well, what are the big decisions you need to make?” I asked.

Silence.

Which lets us hit a little side lesson.

When you’re working on a startup part time, a great way to make sure everything you do is moving you forward is to first ask the question - what decision does this thing I’m about to do help me make? If there isn’t a clear answer, you’re probably working on something frivolous.

So, for Carl, he’s running customer interviews. The purpose of these interviews is to pick a first customer to run with. The one we’ll built intent tests for and eventually a Concierge MVP. Who we focus on is the decision.

So, formally, “which customer should I start with?” is the decisions being made.

“Or…” Carl jumped in.

“In my interviews I’ve found three types of customers I like. One type just wants to learn Spanish and has been doing Duolingo for like 2 years and is considering a tutor, one is moving to a Spanish speaking country and needs a base fast, and the last is working at a company where being bilingual opens up a ton of opportunity.”

OK - here’s a nice, juicy startup decision. Which of the three customers should we focus on first?

It’s easy to see how you could get stuck here. Each customer seems like it could support a business. Each has incentive and motivation. Each is targetable.

And then, Carl popped in with the nightmare suggestion:

“Or,” he said, “I could just build a product that all three can use and see which likes it the most?”

I dropped to my knees, head in my hands, and started weeping. Not really. But this question makes it clear why identities are so important.

Without a clear identity, a throughline for how you’ll make decisions, it’s tempting to always take the broad approach. When you aren’t clear on a why, you look for other people to give you one. This usually manifests in the “let me put something out there and see who shows up” strategy, which doesn’t work.

You need to choose people early on, not hope they choose you.

OK - now that we have the decision, let’s help Carl make it.

And we’ll start, with the decision equation.

—

The decision equation is a description of what your brain does subconsciously when you make a decision. The problem is that it usually does it wrong, so we need to lay out the terms.

The decision = (expected value x confidence interval) - (expected cost x risk aversion).

Basically, what’s the upside, how sure are you, what’s it going to cost, and how much do you fear that cost?

There are also three additional variables that sit outside the equation but impact it.

The first is what I call regret override. If you’re going to severely regret not doing something, do it. Easy.

Next is what I call the uncomfortable override. If there’s an option that feels uncomfortable for the right reasons - meaning, it isn’t uncomfortable because you don’t have adequate knowledge, it’s uncomfortable because the actions you’ll have to take make you uncomfortable, then you should probably do it.

The last variable is the Unfair Multiplier. Is there an option where you have an unfair advantage This will be included in the confidence interval variable, but I like pulling it out to make sure we’re focusing on it. Startups are about finding and exploiting an unfair advantage. If you’ve got one, that’s usually the right choice.

Now, let’s use this equation to help our friend Carl pick a customer.

—

The Decision Equation + Identity

I asked Carl to pick a name for each customer group and I gotta say, I don’t think he understood that this is an entertainment pod as much as an educational pod. But that’s ok. His groups are the Duolingo Drop Outs, which sounds like a dance group from Grease, the Expats - people moving to Spanish speaking countries, and the Career Climbers - people using the language to get a better job.

We ran each customer through the framework, which is, again, that the decision = (expected value x confidence level) - (Cost x risk aversion) with the kickers of the regret override, the uncomfortable override, and the unfair multiplier.

For the Duolingo Drop Outs, the expected value was pretty low. They’re motivated-ish, but there are no consequences to them not learning Spanish. And if they do learn Spanish… so what? Expected value and confidence in that value are low. This is a red flag.

For the second term, the cost of reaching them is somewhat low - we can target them through social ads, although finding them in a specific channel might be hard since they aren’t unified. The risk of looking for them is also low. This is.. fine.

For the variables, the regret override stems from Carl’s identity. We’ll come back to it. The uncomfortable override is non-existant. This path seems as comfy as a summer breeze. Huge red flag. And the Unfair multiplier isn’t there. He’s got some AI skills, but nothing so wild that he’d have a huge head start.

Overall…. Meh.

Next are the Expats, and now we’re talkin.

Their expected value is pretty high. They’re moving to a place where their life would be much better if they learned Spanish quickly. Confidence in that value is high, too. First term is good.

For the second term, the cost to find these customers could be pretty high. Acquisition will be tricky. And the risk in finding them might be high, too. But, this is something we can test. More on that in a bit.

For the three variables, regret is once again tied to identity, so that’s on hold. The Uncomfortable Overide is tempting because of how uncomfortable this seems. You’ll need to find future expats and speak to them, lean into communities, leverage hub and spoke strategy. Way more intimidating than the Duolingo Duds, so this is compelling. And the unfair multiplier is actually there. Carl’s done this. He lived abroad for six months. That’s where the idea came from.

Overall… I’m listening.

Finally, the Career Climbers. Folks looking to get better jobs with this skill.

The expected value and confidence levels are high and clear. Whenever a customer needs to do something before they unlock what they desperately want, we’re in good shape. We want the problem we’re focused on to be mandatory.

The cost and risk term is medium. The cost to find this customer will be high - we might need to go b2b or through linkedin outreach and we’ll probably need to target specific industries where this is a bigger trend. But the cost of this outreach isn’t all that high - I’d call it medium. Some effort and a long sales cycle, but not awful.

For the variables, the regret stays an unknown while the uncomfortable override is once again very tempting. Selling b2b nearly always scares people away, which is a good thing for us. The unfair multiplier, unfortunately, seems nonexistant.

Pushing these three customers through the decision formula before the identity exercise makes it… unclear which he should focus on to start. They all have pros and cons. But it’s a helpful because it shows us what we need to learn to make a better decision.

First, if he’s looking to go after the Duolingo Duds, he’s got to see how cheap it is to acquire them and how motivated they are. Those variables sway the equation.

Next, a huge blind spot for the ex-pats is acquisition. If there are strategies to find them cheaply and reliably, this customer is very attractive.

And finally, understanding the b2b sales potential for career climbers will help us evaluate that customer. If certain types of companies are motivated to train their employees, this could be a fit.

The exercise gave Carl some homework. But before he does it, we want to nail down an identity. Because that can aggressively change the conversation.

Identity - Your Decision Filter

The customer decision we just laid out is painfully incomplete. I highlighted some of the stuff we didn’t know that Carl might try and go figure out, but, in the startup world, clear data is hard to come by.

He could spend 4 months trying to figure out how hard it is to sell b2b and not get any closer to an answer, or he could get a false positive getting in touch with the Duolingo Duds because of a quirk in the algorithm.

Startups are about making decisions with incomplete, crappy information, and Identity closes that loop.

Your Identity is a collection of non negotiables. Stuff that’s important to you and you won’t budge on.

Here’s an example of one of mine and how it helps me make decisions:

I spend at least 20% of my working time writing.

I love writing. I write the pod, and now I’m writing a novel. Every professional decision I make is viewed through that lens.

Every once in a while people come knocking on my door. They want me to join a VC fund or their startup or run innovation at a mature company. My first question is around content creation - if I’m not going to spend 20% of my time writing, I don’t consider it. I don’t need to weigh out the costs and meet the team and leave myself open to being convinced. Because right now, where I’m at in my career, I want to focus on developing as a writer.

Maybe at some point in my life that’ll change, but for now, that’s what it is. And that’s an identity. Something you don’t compromise on. It doesn’t have a price.

And it makes so many decisions so much easier. Both externally and internally.

For you, you might know parts of your identity immediately. It could be what you work on or how you work or who you’ll work with or a combination.

You also might not have a clue. And that’s fine - lots of founders I meet don’t.

If you’re in that bucket, here are four quick exercises that might help:

First - write your story. Where you want to be in 5 years.

The rules for the story are that whatever you try you cannot fail, that it is the wildest version of success, and that you don’t have to worry about how you make this happen. Just tell the story of yourself in the best possible place in 5 years. Write it out longform with 20 minutes on the clock.

Second - look back at your proudest, happiest moments.

Happiness is when we surprise ourselves. See what you accomplished that surprised you. What about it did you love? Why were you so happy? What were you doing? What unique skills were needed?

Third - decide what you won’t do.

What won’t you sacrifice for any price?

Fourth - who do you envy?

Is there a business or person who you think - man, I want that.

From that, develop a few sentence identity.

After doing this exercise with Carl, a few things became clear.

First, on his non-negotiable list was build a b2b business. He wanted to build something b2c. So, the career climbers were out.

Next, he wanted to build something that would help people change their lives. This knocked out the Duolingo Duds. It wasn’t important enough for them.

Finally, he wanted to be extremely close to the tech. He wanted to have tight feedback loops where he saw exactly how customers interacted with it.

This identity led to the obvious choice of expats trying to learn the language. And, it segmented things further. He would need people with high urgency - people looking to immerse themselves in the language over a short period of time - to get the amount of feedback he wanted. He needed people willing to go 3-5 hours a day.

Also, he said he’d regret not working with this customer. It was the only one that was true for.

So, he started testing an MVP that helped a cohort of 5 people interested in totally immersing themselves for a 3 month period of time. The cost and commitment were both high, and the amount of facetime will give him a ton of feedback.

He’s filled out the cohort and starts running with it soon.

Layering on an identity makes that decision clear, and every subsequent decision easier. Features, pricing, messaging -they all have a narrower range.

—

The End

As I continue to do this startup stuff, I realize how important it is to know what you want.

There’s a version of nearly every business that can work.

If Carl wanted to build a venture-backed startup, we could’ve adjusted for that.

If he wanted to go in-person, we could’ve shaped it.

If he wanted to build in public and test wildly, that could’ve worked too.

The problem is never can this work. It’s do you actually want this to work that way?

And most people don’t know.

They haven’t figured out what they want—who they are as a founder—and they don’t realize how much harder every decision becomes without that clarity.

A lack of identity means decisions get made without a throughline. They get scattered. The product balloons. The business bloats. It becomes unmanageable.

And then it’s hard—really hard—to reel it back in.

It’s like those spikes they have at the rental car lot. Once you’ve driven over them, there’s no going back.

So.

Evaluate decisions using the equation.

Look at them through the lens of your identity.

And if that leads you to open a sandwich shop called I Can Be Your Hero Baby…

Just give me credit.

This was the idea to startup podcast brought to you by tacklebox. Check out the 2 week free trial at gettacklebox dot com. And have a great week.