07/09/2014 10:13 pm ET Updated Sep 08, 2014

The Wide World of Startups

It seems like everybody has a startup these days. Or if they don't have a startup, they have at least a blog. Or if not a blog, they have an idea for a startup, where, "If we only get the funding, we could be the next Facebook." Of course they could. "This app is going to revolutionize the industry and change lives!" Of course it will.

A great idea when doing anything in life is to look at the odds. If the odds of crossing the street and getting hit by a car are 90%, you should probably never cross that street. If the odds of drinking 10 shots of Jameson and making a terrible decision are 70%, then expect to have some regrets tomorrow morning. If the odds of creating the next Facebook, Yelp, or Twitter are one in 50,000, then you should probably stick to your day job.

With all the startups, pitches, apps, videos, and noise in this world, where does one make any dent at all? Not to be a hypocrite, but even I have my own startup. It's a basketball training website and it helps younger athletes better their basketball careers. When I created it, I thought I would create a few YouTube videos and it would explode. Then when I did a search for "basketball drills," tens of thousands of results came up. Without spending an insane amount of money on advertising, it would be nearly impossible to come up first on that list.

The problem with everybody trying to sell their "next big thing," is that it reduces the validity of the next person's "big thing." If everybody gets As on their test, then is the class really that smart, or is the teacher changing the grades?

The scariest thing about startups is its war with human psychology. Our brains have been trained over thousands of years to stick with the comfort of what we're currently doing. If we have food, a job, and a place to live, then our brains are saying, "Don't do anything different, because you're surviving and that's perfectly fine with me." It takes a while for our brain to say, "Okay, you can do this a little different, but keep everything else the same."

The momentum changer with startups is if your friends start to use the app/website/service. The influence of your peers is stronger than you could ever imagine. If all your good friends started drinking heavily, you would probably do the same. Just like if all your friends started using that app which made your life a tiny bit easier, then you would try it out as well. Social inclusion is hard-wired into our psychology, and there is no way around it.

I was at a startup networking event the other night, and everybody was pitching their product, telling me the size of the market (each one was over a billion dollars), and how their product is going to change the way people live. The odds are that 90% of these startups will fail in the near future. I'm not being a buzz kill - I'm just relaying the facts. When venture capitalists invest in startups, they know that a vast majority will lose them money and fail. What they are looking for is the outlier that will generate them a huge return and make up for all the other lost startups.

The craziness about the startup atmosphere is nobody really knows what will happen. If Bill Gates created Microsoft last month, people would laugh at him. The hard/lucky part is to get into the game at the exact right time; not too early, and not too late.

Some friends of mine created a website that helps people find lawyers. Initially, you think, "what the heck kind of startup is that? It's easy to find a lawyer." But once you think more about it, you realize that getting a lawyer isn't so easy. You can wait days just to talk to one, and they want you to pay them even before any work is done. Once the work is done, how do you know that there won't be more bills to pay? This is the battle with human psychology. When we do things a certain way for decades, we think there's no reason to change. But then we need a lawyer and we thank the founders for creating something so easy-to-use.

The rough thing about startups, too, is that there aren't any rules. When you're at a company, there is a clear hierarchy, an HR department, and written rules for every employee. In a startup, there are 5-10 friends struggling for their life to make some money and get some exposure. The founder sells the dream and everybody buys in. However, this is where bad things fester. The CEO of Tinder was recently accused of sexual harassment and demoting a co-founder because she wouldn't sleep with him. With all the glamour and potential future of startups, these are the dirty things that sometimes go on behind closed doors. Unfortunately, this has probably happened at many startups not as high-profile as Tinder. Once desperation starts to override everyone's emotions, who knows what the people with power will do?

In the end, the exciting and scary thing about the future is that it is unknown. But think about it: Would the future even be worth experiencing if we already knew what was going to happen? If we already knew, there would be no odds, no strategic plans, no risk/reward decision making, and salespeople wouldn't need to exist. It would be more boring than we could possibly imagine.

That's why even though startups are crazy, challenging, and risky, they make us come alive. It forces us to think outside the box, do the extra research, and put our lives into something that we believe will help change the world. At the end of the day, no matter if we fail or not, you can't take that passion away.

As my friend Raad from Lawtrades told me, "When it's bad, it's really bad. But when it's good, it makes everything totally worth it. What I love about entrepreneurship is the never-ending quest of continuously learning and always improving yourself."

Therefore, if our reason on this earth is to learn and become a better person day-by-day, then why aren't we all in startups?