Scaling a startup to exit takes a lot of hard work, time, sweat, and tears, and still, not everyone is going to make it that big, even though many startups start out with the intention to get bought. People assume that life is a big party after a successful exit, but that is not 100% true. GE Digital Executive Alex Clark, whose company, Bit Stew was acquired by GE Digital in 2016 for more than $200 million was born and raised in Silicon Valley, which has definitely impacted his mindset on founder success. I met Alex after his panel at BC Tech Summit, where he talked about how to scale from zero to exit. What he did not discuss much was how the exit affected his life.
Alex Clark has been passionate about tech for as long as he can remember, even before tech as we think of it today was not even a thing. When he was a kid, he wanted to be a cartoon animator, but he soon realized that computerization may leave him out of a job. He was also interested in science and he considered becoming an aerospace engineer. Neither of these ideas really panned out, but years later, Alex decided to follow a very specific path that he outlined for himself early on. “I told myself, I want to be a software engineer, then an software architect, then later a chief technology officer, and ultimately sell a company by the time I am 40,” Clark said.
“I followed that path–I was a CTO by age 28 and I sold the company by 38.”
Don’t forget to enjoy the moment
In the stage when founders are gearing up to exit, it’s easy to forget to enjoy the moment and appreciate successes along the way. This stage is about getting more done than you would normally because you have this big goal, and by taking average steps, you would never get there.
You have to stick to the plan, and so you try to anticipate any and all setbacks or challenges that may arise–and this can also cause problems. “You are so busy following that plan, you don’t have your head up, and you don’t get to enjoy it,” Alex Clark says. “We had a very senior woman coming in years ago who was chief of operations. She said to me, ‘Do you ever sit back and look at your success and just feel very happy?’ I remember two things about that: I was impressed that somebody of her caliber was asking me that question, and that the answer was no, I never do. Because it’s always ‘What’s gonna kill me the next day, what is the pain I have to solve?’” Learning from that previous experience, Alex said he would recommend enjoying the journey more instead of letting it rush by.
The fun part is not what you think it is
If you are like Alex, who is destination-oriented, it may be difficult to focus on appreciating the process. People think they will finally enjoy it when they exit, right? “That has always been a personal struggle for me. It isn’t until the exit when you realize that the fun part is being excited about the process and what you do every day,” Alex Clark says.
When I ask him about those process days, his tone of voice changes. His eyes light up and I can tell he is the builder type, someone who needs to build so he can feel alive. I imagined that’s how it was in the beginning when his goal was to create a product that filled a need he had. “Once it had some level of traction, the plan was to sell it,” Alex said. “I always said ‘wouldn’t be nice to sell to GE?’ Then it happened.”
What no one will tell you: what happens after the excitement
As I was sitting next to Alex Clark, I tried to imagine the moment when a founder signs the contract and realizes that it’s real. After meeting with more than 30 lawyers for months during the process of selling the product, not to mention the 10+ years he spent on scaling this company, all led him to that point. It must have involved intense relief, excitement, and stress all at once. “It’s not something I feel very comfortable talking to a lot of people, because they are like, ‘you sold your company for a lot of money, what are you complaining about?” Alex said. “It’s not really a complaint, it’s a statement.”
If the very few entrepreneurs who are going through an exit don’t talk about what they are experiencing emotionally, they can’t help others who are chasing the same goal. This can lead to a nightmare if founders are not prepared for what could be ahead: anxiety attacks, depression, burnout, isolation, and all the other dark side effects that can come along with the sale of their company, which was their main focus and drive for many years. “After we sold, there was excitement. But it doesn’t last very long,” Alex Clark said. “The money is nice, the reward is nice, but I don’t wake up today happier than I did before. That’s what people expect, that once you wake up, life is a big party. But it wasn’t. Also, that was never what defined me.”
Mindset transition: from not having money to having millions in the bank
Before the company is bought out, founders are worried about paying employees, and in Alex’s case, he was not paying himself. He wasn’t in a very strong financial position to do it, and he had bought a house for his mom so she could retire. “I was paying the mortgage for her, and I was living in a very small apartment, and suddenly, I couldn’t pay myself, because I have to fund payrolls,” Alex Clark said. “I was more worried about losing the house for her, since I knew I would figure my life out. But after the exit, that level of stress is gone, the house is paid off now and she has a home, so I am happy.”
Living this way for a couple of years must be tiring, and I can’t even imagine how difficult it may be for someone like Alex to process how far he has come. One day you don’t have much, and the next day you can buy anything you want. “Now you have fancy toys in the garage, and a bigger home, but that’s not really that makes me go ‘my life is complete now,’” says Alex. “When you have the distraction [your company] gone, you are faced with a question: what do I want in my life? Who am I? What do I want to achieve? I was having some bits of moments where I was depressed and anxious. But you kind of keep it quiet. You either fall to the darker side, or you say no, I am going to spend time figuring out what my purpose is going to be.”
FROM DESTINATION-ORIENTED TO MISSION-ORIENTED
After the company was sold, Alex took some time to relax and think about what he could do next. Taking time to seriously reflect is the most important thing you can do after a huge shift like that. You need to understand where you come from, what you’ve achieved, how that process affects your future, and how you can turn your previous experience into something meaningful that can serve people. “I am very thankful to where this opportunity has lead and the doors that have opened for me to fulfil what I hope is a greater purpose.” Alex Clark said.
Ultimately, the story comes back to that little kid who wanted to save the world, but who first had to gain skills and create his own resources to do it. That’s how an exit can also end in fulfillment, not just financial success. Don’t forget: not everything is what it seems, and there are more struggles that come with an exit than most people realize. Do you really have what it takes? Alex Clark did, and he turned out to be a winner—both to the outside world and to himself.