Last week, Jet launched. Jet is essentially a member’s-only shopping club (think of an online equivalent to Sam’s or Costco), where you pay a yearly fee to be a part of it, and save on various products as a result.
Frankly, I’m unsure it’ll work. I signed up for the trial, looked around, and the discounts just aren’t that impressive. I don’t personally see anything there that would suggest that this is going to be the hit that investors seem to think it will be.
But my opinion doesn’t matter. Jet raised $140M at a valuation of $600M, and some estimates say it may command a valuation north of $1B after it gets going. Obviously, someone believes that Jet has what it takes to be a major player in the e-commerce world.
Jet was founded by Marc Lore, who’s had hits before. He created and sold Diapers.com for $545M, and worked at Amazon for a couple years after he sold it to them. Lore has experience in e-commerce and online fulfillment, and the track record to back it up. Investors know this, and they threw money at Jet, largely based on his past.
The lesson is this: having a track record of success is critically important. When you start out, building your first startup, you have no credibility. I don’t care how awesome your idea is, and how many books and articles you’ve read on it. The fact is, no one believes you, and that’s OK. That’s how it’s supposed to be. Until you prove you know your shit - by actually DOING something - it’s totally fair that people judge you otherwise.
Marc Lore can go raise $140M because he’s proved himself. He’s put in his time, slogging through the bullshit and the judgment, and came out the other side successful. Because of that, others (investors included) trust him. They trust that he knows how to go from idea to viable business, and it’s not based on what he says - it’s based on what he’s done.
You may, like I do, think that Jet is a weak idea. You might think it won’t work. But that doesn’t matter. Ideas don’t matter. What matters is a history of execution and judgment that’s led to successful ventures in the past. For that reason, I’ll likely end up wrong, and it’ll end up being a big success. Who knows.
The bottom line is this: track record counts, and it counts for more than pretty much anything else. Focus on getting your stuff to the market, and executing extremely well, not baffling people with bullshit or making up excuses as to why it’s too hard to execute. Focus on shipping great products, and you’ll earn respect, just like Marc did.