Rebounding: An Essential Founder Skill

In basketball, a rebound is the act of grabbing a missed shot and giving your team another chance to score. In the startup world, a “rebound” is when a founder or company recovers from a setback or rejection and turns it into a win. In basketball, it’s also part of the strategy.  But in startups it’s purely about resilience, persistence, and a new opportunity. For any founder, how well you can rebound is one of the most important factors in your long-term success. Every founder—and particularly those selling sophisticated, complicated products—needs to learn firsthand how to rebound, if they ever hope to succeed.

The Reality of Rejection and the Need for Rebounds

Rebounding is the cousin of rejection. You took a shot with your product, got it into the hands of a customer that is exciting, and something goes wrong. Maybe the software glitches. Maybe the setup is too hard. Ask anyone in the hardware or complicated software business whether in their early stages, they had problems getting customers up and running, and they will laugh and start to tell you stories. In most cases, these problems lead to a quick rejection.

Customers do not have time to figure out your product bugs. (This, by the way, is why the concept of “design partners” emerged to create a more friendly engagement structure with potential customers who aren’t ready to buy but want to try and help you make the product better). When a customer finds bugs or problems, they will reject your product. You may not even understand why. Maybe your product failed to interoperate with other vendors’ products properly. Maybe it was too hard to install. Maybe it did not appear to deliver on its promised capabilities. Regardless, I only realized we were in the middle of rejection because we persisted.

The Challenges of Launching in a Conservative Industry

Rejection is something almost every founder faces, especially when launching a product in a conservative industry like telecom. Telecom isn’t a place for risks—communication and data networks cannot fail. The industry is tightly regulated, with a strong bias toward established vendors who have proven their reliability over decades. This is why you see so few startups in telecom equipment and telecom software compared to the thousands of new companies in SaaS. The barriers to entry are steep, and the tolerance for error is virtually nonexistent. But if you can break through, the rewards are substantial.

What Makes a Great Rebounder

A rebound in this context isn’t just about bouncing back; it’s about learning from setbacks, adapting swiftly, and using those hard-earned lessons to drive forward. Resilience in the face of adversity, the persistence to keep going when things look bleak, and the ability to reinstill confidence in a skeptical customer—these are the qualities that define success in the high-stakes world of startups. A great rebounder has all of those. And make no mistake—every founder must be a great rebounder.

How We Almost Lost FedEx

I remember my own first rebounding experience. It was with Federal Express. They bought eight units of our product just a week after we completed the design and had evaluation units ready. The stakes could not have been higher. A Nortel Networks salesperson had mentioned to them that he’d heard of a company called Digital Link, started by some ex-Bell Northern Research employees. He knew nothing more about us but from what he had heard, our product could help FedEx by making it easier to manage their digital and voice networks while paying less.

For reasons I never understood or learned, FedEx immediately placed an order for all eight of our evaluation units. This was our entire inventory. It would also wipe out our evaluation program for some time. For us, this was an incredibly significant order of nearly $10,000. For FedEx, it was just a rounding error and probably something that occupied very little of their minds. We understood, however, that this could be our big break. My co-founder was so excited that he went home immediately to get bubble wrap to pack them safely. I called FedEx to confirm the shipping method (which was perhaps a silly question). Of course, they provided their FedEx number, requesting overnight delivery.

The High Stakes of a Major Customer

For a startup, landing a customer like FedEx is a game-changer. They’re not just any customer. FedEx is a global powerhouse with a reputation for getting things done right and one of the most admired businesses in the world. Having FedEx on your customer list is like having a golden seal of approval; it instantly elevates your credibility. The FedEx logo on your site and in your reference list tells other potential customers and investors that your product isn’t just good; it meets the rigorous standards of one of the most respected technology companies in the world. (I know, FedEx is a shipping company but they also had a reputation for being a very smart technology infrastructure builder). This kind of customer validation is priceless when you’re trying to make your mark in a competitive and highly conservative market.

Facing a Potential Loss

A week later, I followed up to ask how the products were performing. Ron, our contact at FedEx, responded, “We haven’t installed them yet.” I was baffled. Why had they requested we ship our product to them overnight only to let the boxes sit unopened? Another week passed. When I called again, Ron seemed a bit annoyed. He gave me the same response. This was my first real experience with sales, and I was beginning to understand just how tough it could be. I was learning the lesson that my priorities may not be the same priorities as my customers. For Ron, installing our product was one of many competing priorities. Still, I wanted to make sure that our product was working as anticipated. So much was riding on this.

After another week, at my partner’s urging, I called Ron again. This time, he said, “Yes, we tried to install them, but they don’t work. I’ll be shipping them back.”

My heart sank.

I hung up the phone and rushed to my partner’s office to deliver the bad news. We decided to call Ron together. I explained that the engineer who designed the box was on the line with me. Ron had no idea that I was the CEO, and that Herb, the engineer, was also my co-founder. In fact, we were the only two employees at the time. Ron described the problem to Herb, who calmly and confidently convinced him that he could be there the next day to fix it.

Herb got on a plane, showed up at Ron’s office the next day, and got our boxes up and running, the day after. Ron was impressed with Herb, and with our swift response. He had no idea how desperate we were to make this work. After Herb’s visit, Ron called me and said, “Feel free to use my name as a reference!” We were both relieved and exhilarated. We had learned a critical lesson, too—our first rebound. 

Regaining Trust is a Critical Founder Skill

This experience was pivotal for us. Not only did we manage to keep a major customer, but we also gained an invaluable reference. Being able to say that FedEx was a satisfied customer opened doors that would have otherwise remained firmly shut. It gave this tiny company, just beginning to sprout, incredible credibility. 

Stories like this, where a startup regains a customer’s confidence and wins a second chance, are a testament to the fortitude of founders and their product and a rough but necessary introduction into the realities of winning customers. As a new founder, I thought better features, and lower prices always win. It was a naive assumption.   Vendors also need to earn the trust, and build lasting relationships, to thrive in a tough market. I am lucky I learned the art of rebounding relatively early in my career. It would be a crucial ingredient in my journey taking Digital Link to an IPO.