About 6 years ago, an ex-colleague and good friend of mine and I got together to launch a startup. It was a year before Groupon entered the UK market so we decided to launch a clone. Genius, we thought.
We both had a Sales background and thought we knew it all. I’d worked in two media startups before, both failed miserably. The first pissed £5m up the wall in less than 12 months (this was during the first bubble) and the second were just unrealistic about the value of the media proposition. So much so that my second interview went on for over 2 hours as I pointed out why their pricing model didn’t stack up.
The plan was to get established before Groupon reached British shores. We got to work and started to write a business plan. Painfully crafting and recrafting a bunch of assumptions to create a plausible business case. It was a beautifully written assumptive plan, if I do say so myself. We followed with the Executive Summary and I literally cried doing the 5 year financials which I created from scratch, by the way. Who knew there were Balance Sheet, P&L and Financial Statement templates out there. Armed with these three things, we set out to seek funding. During this whole process we spoke to no one but a few trusted close friends for fear of someone stealing our brilliant idea. Ironically a competitor launched about 6 weeks in (well, that scuppered the someone might steal our idea obsession). I was doing some contracting working at the time and the Head of Business Development emailed me at the company I was contracting for (an ad offering) about using us as a customer acquisition channel. I used the meeting to capture as much intelligence as possible, believing I’d put us in advantageous position somehow. There was never a truer statement than, at exactly the same moment you have that fantastic business idea, several people have exactly the same thought. It’s about who executes and executes well.
The reality of the venture at this point was that we were two business people trying to build a tech business and it hadn’t even crossed our minds that we needed to find either a tech co-founder or at least pay a someone to design an MVP for us to test with. We didn’t actually know what an MVP was. Instead, we did what we did best started talking to local retailers, beauty and health spa’s, major hotel chains to build a prospect list. One thing we did figure early enough was that this was a cash intensive business requiring a lot of feet pounding the streets to find the businesses who were going to use us and a shed load of cash pumped into marketing to promote the deals to consumers. With the absence of money and coming from a traditional media background, we knew if we partnered with the large regional newspaper groups, we could kill two birds with one stone. These groups were losing advertising revenue at an astronomical rate as they struggled to adapt to a digital business but they had sales teams and established relationship with local businesses. Marketing and Customer acquisition solved. What we hadn’t anticipated was how slow it was going to be trying to pin these guys down to a meeting. In the meantime, the days and weeks were hurtling by.
Anyway, we pushed on and started to approach Angel investors. One thing we didn’t expect was the number of people within our existing network who were willing to advise us or put their reputation on the line and introduce us to investors – from old money in Norwich to new money in London. The one common thing we heard a lot before we’d barely finished the mandatory handshakes was “I’m not looking for any new investments at the moment but tell me about your idea anyway”. Then we met Emma Loisel through a mutual friend. At the end of the meeting, she told us to go and read Getting to Plan B. Execute as per the book and come back to her once we were done. I immediately bought the book and after the introduction, I wondered why no one had advised us to read this damn book six months earlier.
The realisation that we knew absolutely diddly squat about building a business was the most humbling experience ever. Nine months in we shut up shop as we hadn’t reached the milestone we set before I was rendered immobile for three months due to a toe operation.
When we finally down-tooled we were emotionally, mentally and physically exhausted. We both just seemed to want to sleep all the time, we were certainly making up for all that burning the midnight oil jazz.
When we look back now, we laugh hysterically at our naievity. But I also know that without us just about ticking every single box of things not to do when a running a startup, I wouldn’t know what I know now. It created a hunger to understand and learn.
In observing startups, I notice that it’s what many Founders who have already successfully forged a career elsewhere have common, the belief that they know what they’re doing. They are not fully closed to advice or an alternative perspective so long as it’s fits into their view of how things should be, what they already know and are comfortable with. When someone picks apart their baby, it’s because they don’t get it. It’s personal. The most valuable lesson from my failed startup attempt was accept that you know nothing, even if you do know something , just pretend then start asking questions.