From Boom to Bust: Lessons from The Cold Start Problem in Today’s Startup Landscape
Andrew Chen’s The Cold Start Problem is a book every founder should read. It’s a playbook for overcoming one of the toughest challenges in building network-based businesses: getting the first users, connections, and momentum. But more than that, the book reflects its time—a period when capital was abundant, growth was paramount, and startups could afford to experiment and fail.
For me, the book was not just insightful; it was deeply personal. As the founder of Tørn, a marketplace we launched in 2020 to connect surplus building materials from retailers with customers, I’ve spent the last few years navigating the realities of running a startup. Reading Chen’s book gave me a moment to reflect on our journey—what worked, what didn’t, and what it means to build a company in a world that’s constantly changing.
The Early Days: Riding the Wave
When we launched Tørn, it felt like we were living the playbook Chen describes. Our mission was to solve our version of the “cold start problem,” creating a network where sellers of surplus products could find buyers who valued quality and affordability. Like Airbnb, one of Chen’s prime examples, we relied on network effects—making each connection stronger as more users joined.
Chen’s observation that “It’s better to have 100 users who love you than 1,000 users who kind of like you” became a guiding principle for us. We focused on building a loyal base of sellers and buyers who believed in our vision of reducing waste in the building materials industry. And for a while, it worked. The market was booming, venture capital was flowing, and the pressure to scale quickly was matched by the resources to do it.
The Storm Hits: 2024 and the Shift
But the world doesn’t stand still, and neither do markets. By the spring of 2024, Tørn found itself in the middle of a perfect storm. The building materials and DIY sector, which had thrived during the pandemic, experienced a sharp downturn. At the same time, the financial landscape shifted dramatically. Capital was already dried up, and the focus moved from growth at all costs to sustainable profitability.
Chen’s book, though rooted in the optimism of the 2010s, helped me make sense of the challenges we faced. It reminded me that the strategies that worked in one era don’t always translate to another. The companies Chen highlights succeeded in an environment where bold bets and long timelines for profitability were possible. For Tørn, we needed to change the trajectory and change fast.
The Timeless Playbook: Resilience and Agility
If there’s one thing that doesn’t change, it’s the need for resilience and agility. When your original strategy doesn’t work, you adapt. For Tørn, that meant rethinking how we operated. Instead of chasing top-line growth, we focused on building a leaner, more efficient business. We are doubling down on our relationships with sellers, improving our processes, and prioritizing profitability, all while with one third of the resources.
Chen’s advice, “The cold start is the hardest part, but it’s also where the magic happens,” applies not just to the beginning of a company but to every stage where you need to start again. Being a founder means constantly reassessing what’s working, what’s not, and what needs to change. It’s a cycle of learning, adjusting, and moving forward.
Lessons for Founders Today
Reading The Cold Start Problem reminded me that while the context has changed, the fundamentals of entrepreneurship haven’t. Here are a few lessons I’ve learned that might help other founders:
Focus on Resilient Growth: Growth is important, but it needs to be sustainable. Build a network that can weather downturns, not just thrive in booms.
Experiment Smarter: Test ideas, but be deliberate. Resources are limited, so every decision counts.
Stay Close to Your Network: Your customers, partners, and team are your strongest assets. Strengthen those relationships to build a solid foundation for the future.
Looking Ahead
The 2010s were an incredible time for startups, and The Cold Start Problem captures the optimism and ambition of that era. But as I’ve learned over the past few years, today’s reality is different. The playbook has evolved, but the spirit of entrepreneurship—resilience, agility, and the ability to adapt—remains timeless.
For founders navigating today’s challenges, the lessons from Chen’s book are still relevant. The magic of building something meaningful comes not just from solving the cold start problem but from overcoming the challenges that follow.
As Tørn continues to evolve, I find myself returning to one simple truth: being a founder isn’t about avoiding hard times—it’s about finding the strength to thrive in them.