A lot of people in tech are starting to think about the practical pros and cons of building their own startup. Naturally you'd think about the cash runway, the chance of success vs failure, the risk it imposes on your family and lifestyle and many other things.
One common mental blocker that I notice in this thought process is around the idea of "building in stealth" as opposed to building in public. Most startup content are written for those who build in public, after all. In fact, there's an article about how founders should be dinner party jerks and talk about their startup aggressively at any chance you get. So I thought it might be useful to talk about stealth startups a bit.
Here's a disclaimer: I actually don't think it's a good idea to run a stealth startup if you can be public about it, but I do think it's possible to build in stealth and win if you absolutely need. Here are my thoughts on this:
What is a stealth startup, and how is it different from a regular startup?
A stealth startup is essentially a tech company that operates in secret. To understand it fully, let's start with what a startup is: according to Paul Graham, a startup is a tech company designed to grow fast. Unlike small businesses, which might aim for modest growth, startups are built for rapid scaling. They leverage technology to multiply efficiency and productivity, allowing them to grow exponentially without a proportional increase in resources.When you're building a stealth startup, you're keeping your company under wraps. This could be because you're developing something highly competitive or groundbreaking, and you want to avoid tipping off competitors. Or maybe you have a full-time job and want to keep your side project discreet. Some founders stay in stealth mode because they're concerned about the potential for failure and prefer to reveal their venture only when they're confident about its success. Essentially, you're in stealth until you're ready to make a public splash with your product, funding, or other significant milestones.
What are the benefits of operating in stealth mode?
While opinions vary, I personally think building a stealth startup is often not the best approach unless absolutely necessary. The potential benefit of operating in stealth mode might come into play if you're developing super-advanced technology in a highly competitive environment, where surprising competitors could be critical. For example, if you're working on something groundbreaking and need to keep it under wraps to gain a strategic advantage, stealth mode might be beneficial.However, in most cases, being in stealth mode can be a disadvantage. Building a startup is incredibly hard, and you need all the momentum you can get. If no one knows about your existence, you reduce your chances of attracting the right people, funding, and early adopters. Even if you prefer to keep a low personal profile, ensuring your company has a significant presence is crucial for success.
What are the downsides/challenges of being a stealth startup?
Operating in stealth mode can have significant downsides. It reduces your visibility and luck, making it harder to build momentum. You need people to support you, whether it's attracting talent, securing funding, or gaining early users. If no one knows your startup exists, you limit these opportunities. Stealth mode might be beneficial in rare cases where surprise is crucial, but generally, it can hold you back.
How long should a startup remain in stealth mode?
The answer is: ideally, zero days. The moment you decide to start a company, you should tell people about it. As a startup, you need customers, feedback, and momentum. Even if you don't have a product yet, talking about the problem you're solving helps attract the right people and resources. The world often encourages founders to be quiet, especially when things get tough, but that's the time to be loud and proud. Momentum builds momentum, and people are drawn to that energy. Staying silent limits your opportunities, so it's always better to be vocal and open about your startup journey.
How do stealth startups attract investors or talent without revealing too much?
The more stealthy you are, the more resourceful and well-connected you must be to offset the luck you're losing. You need to have a strong network of talent, investors, and clients to compensate for the lack of visibility. If you don't already have a network that you can tap into discreetly, then being stealthy can be a major disadvantage. It's crucial to ask yourself: are you so exceptionally resourceful that you can maintain stealth and still succeed? Most first-time founders aren't, which is why stealth mode can be risky.Additionally, your location matters. If you're in a city like San Francisco, where you're constantly exposed to entrepreneurial talent and can easily network, stealth might be manageable. But if you're in a less dense entrepreneurial hub, you'll need to work harder to find the right people without broad exposure. Ultimately, unless you have a compelling reason and the right conditions, stealth mode can create more obstacles than advantages.
What are some examples of successful stealth startups?
The truth is, whether a startup succeeds or fails, most people don't remember if it was stealth or not. People care about good products and growth. One recent example is DeepSeek, a hedge fund that kept a low profile while building an AI company. They were extremely resourceful and maintained secrecy until they were ready to reveal their innovation.
i had to google and turns out Palantir, SpaceX, Stripe and Dropbox were stealth :D
What strategies can a stealth startup use to maintain secrecy while still making progress?
First and foremost, focus on the fundamentals of your business. If you have a clear vision and strong conviction in your product, you can rely on that. When building your team, use your personal network. If you can hire key people through close connections, you're on the right track.
For clients, the more specific your understanding of your audience, the easier it is to reach out without broad exposure. If you know exactly who to approach, you can maintain secrecy more effectively. For instance, if you can just pick up the phone and call 10 friends in different enterprises to gauge interest in your product, that’s a great start compared to having build a 10,000 email list of random employees random enterprises to see if anyone wants your product. Much harder to be stealth that way. You'd eventually have to jump on calls/meet people for coffee etc. and they'd wanna see your linkedin and so on.For investors, having a strong network is crucial. If you have a list of investors who can write the first $50k to $100k checks, that’s ideal. This means you can secure funding without having to pitch to a hundred different investors. The fewer people you need to talk to, the better your chances of staying under the radar.Essentially, building a strong network before starting is like having a 'mafia' of connections. This allows you to operate quietly yet effectively.
Can I build in stealth mode but minimize the risk/cost of building in stealth?
Yes, but you have to take charge of your luck maximization as an entrepreneur intentionally, because unlike working at a company or going to school, as an entrepreneur nobody automatically provides you with anything, it's all you, and if you've never spent any time in your life thinking how these systems (school, workplace, society, family etc.) have created luck for you at various stages of your journey to make sure you don't reinvent every wheel, you're gonna face a full-on war on your confidence that you might lose.
My advice, having come from the 3rd world but leveraged super intense and niche online communities to 10-100x my luck and resources, is to find the best private founder community that you can find and join it, and make a few friends at your stage who won't compete with you, won't get jealous of you, won't be pessimistic and tell you "you can't do this and that".
Should you find or build a founder mafia?
There are hundreds of founder communities out there but frankly most of them suck because they have no curation or moderation and aren't even properly gated. They're either too noisy or too dead.
You can create such a community yourself but it takes a serious amount of effort and feels almost like building another company. I know it because I built one such community LearningLoop while I was building my tech startup Integral.
I can vouch for Learning Loop and it being the founder mafia that'll make you instantly luckier regardless of your location or industry, if you're starting a new startup and are required to start in stealth mode.
All the best.
