Ask HN: My startup has basically failed. What now?
228 comments
Read your OP and all follow up posts in the thread. My advice is take 2 weeks vacation (travel somewhere), and do not work during this time. You need to step back and digest what you’ve learned so far. Don’t feel guilty about taking this time, it’s necessary for making an important decision.
If you come back after 2 weeks and feel the same way, shut it down and return funds to investors. Your investors and advisors are very very naive (how did you raise 220k as a solo founder with no product? How did you spend 120k in 9 months!?) and it would be unethical to take advantage of them by continuing in something you no longer believe in. You’re closer to the business than they are, your judgment about whether it’s time to pull the plug is more accurate than theirs.
On the other hand, if you come back with a fresh perspective and want to keep trying, do so and inform investors appropriately. And try to reduce your absurd burn rate.
If you come back after 2 weeks and feel the same way, shut it down and return funds to investors. Your investors and advisors are very very naive (how did you raise 220k as a solo founder with no product? How did you spend 120k in 9 months!?) and it would be unethical to take advantage of them by continuing in something you no longer believe in. You’re closer to the business than they are, your judgment about whether it’s time to pull the plug is more accurate than theirs.
On the other hand, if you come back with a fresh perspective and want to keep trying, do so and inform investors appropriately. And try to reduce your absurd burn rate.
I second the first two comments (i.e. take some time off to think, and be sure to take into account that money is NOT as valuable as time). I founded a startup just before the dotcom crash, failed to find seed money during&after the crash, but kept at it because I felt obligated to produce a return on the FFF money I had already taken. The company pivoted twice, going from product to consulting (in a different area) and then back to product again. Now it's becoming somewhat successful, but it has taken over 15 years!! If I could go back in time I would have shut down the company in 2002 and spent the time after that building new things. I think it would have made me both happier and more wealthy.
I'm with you 100%. I've had 7 failed startups (well, not failed but didn't make me enough to buy a jet).
It's easy to know when to get out when you're making nothing. It's easy to stay with it when you're growing.
The hardest part is when your stagnant.
If you no longer believe in the product/service GET THE FUCK OUT.
OP doesn't believe so he needs to shut it down or turn it over to someone else IMO.
I'm on startup #8 right now and it's slow going but turning a nice profit. I only bootstrap shit now (well since startup #4) so I'm not worrying about money or investors.
It's easy to know when to get out when you're making nothing. It's easy to stay with it when you're growing.
The hardest part is when your stagnant.
If you no longer believe in the product/service GET THE FUCK OUT.
OP doesn't believe so he needs to shut it down or turn it over to someone else IMO.
I'm on startup #8 right now and it's slow going but turning a nice profit. I only bootstrap shit now (well since startup #4) so I'm not worrying about money or investors.
Take 2 years vacation. Go travel somewhere, see the world.
And remember that start-ups are just Unemployment 2.0. Nothing had really happend...
And remember that start-ups are just Unemployment 2.0. Nothing had really happend...
Arent you advising them to take a vacation during the most critical juncture of the business? Isnt this just promoting more of the perceived or real iresponsibility that led the business to where it is now? Seems like if they are serious about the business they wouldnt be able to take their mind off the issue. Id only take a vacation if Id decided definetely that i was shutting it down to decompress and think about my next thing
Since the burn Rate is now very low OP now has all the time in the world to take her decision.
I have founded several businesses and there is nothing as productive as taking your mind off your work and finding a new perspective.
Sometimes when moving fast it is tough to see clearly. People say 'vacation', but it is two weeks where you are forced to face the reality of the situation instead of distracting yourself with 'work' and getting no sleep.
>And try to reduce your absurd burn rate.
when we started we had 3 employees. we carried 3 employees for 3 months at which point we went down to 1 employee and myself. it is only as of last month that i'm the sole employee of the company (and obv the burn has gone down proportionately)
when we started we had 3 employees. we carried 3 employees for 3 months at which point we went down to 1 employee and myself. it is only as of last month that i'm the sole employee of the company (and obv the burn has gone down proportionately)
That makes a lot more sense. Sounds like you were more than half way to shutting down already if you dropped two thirds of the founding team. Still it’s advisable to take a step back and digest before pulling the plug, especially since you’ve worked every day for 9 months.
With $220k you basically cannot have any full time employees and would need to pay yourself little or nothing (in USA or equivalent).
> How did you spend 120k in 9 months!?
More like, "How did you ONLY spend 120k in 9 months?!"
More like, "How did you ONLY spend 120k in 9 months?!"
Jason Lemkin recommends giving it 24 months to start a B2B SaaS. B2B SaaS is a long road despite the big splashes sometimes seen like Slack or Intercom.
https://www.saastr.com/if-youre-going-to-do-a-saas-start-up-...
Also watch the CEO of Segment talk about their journey to product market fit.
https://www.youtube.com/watch?v=_6pl5GG8RQ4
https://www.saastr.com/if-youre-going-to-do-a-saas-start-up-...
Also watch the CEO of Segment talk about their journey to product market fit.
https://www.youtube.com/watch?v=_6pl5GG8RQ4
Slack was developed internally for years at Tiny Speck before being released.
So they aren't like most startups who generally start their 24 month period with a lengthy period of product development.
So they aren't like most startups who generally start their 24 month period with a lengthy period of product development.
great point. So in fact Slack's superficially meteoric rise was prefixed by a long incubation period within Tiny Speck. So if you shift the timeline to when the precursor internal version of Slack was developed it supports the point of most B2B SaaS companies needing 24 months to prove real traction.
this is actually a very good argument to 'ship fast, fix later' proponents. I think 'ship half ass product asap' doesnt really work in SaaS because there isnt endless pipeline of prospective clients and word spread quickly in small circles. The product must be market ready and impressive to a certain degree to achieve positive resonance in its circle.
if it takes 24 months, how do you convince investors to fund those 24 months of searching, before you can show any meaningful numbers?
You can and should show meaningful numbers while searching. And you should probably do some of your 24 months and numbers before you quit your day job and ask for money.
“We talked to 15 friendly CIOs at mid sized banks, and they all said that pen theft was a top three problem for them in 2018, they plan to budget up to $30k to solve it in 2019. We are pretty sure we can build RFID pen tracking systems for under $100 per pen, but we haven’t figured out how to price it for our market. I do know two bank branch managers who are willing to run beta tests.”
I mean, that’s still a dumb idea, but you can get started putting numbers around something without running down the whole 24 month clock. And usually most of the risk is in the product market fit, not in your tech team’s ability to create pen trackers.
Edit to add: now, if you integrate blockchain into your pen trackers, and have an ICO for pencoin, then this is totally fundable. Mid sized retail banks are definitely looking for a way to spend money on blockchain.
“We talked to 15 friendly CIOs at mid sized banks, and they all said that pen theft was a top three problem for them in 2018, they plan to budget up to $30k to solve it in 2019. We are pretty sure we can build RFID pen tracking systems for under $100 per pen, but we haven’t figured out how to price it for our market. I do know two bank branch managers who are willing to run beta tests.”
I mean, that’s still a dumb idea, but you can get started putting numbers around something without running down the whole 24 month clock. And usually most of the risk is in the product market fit, not in your tech team’s ability to create pen trackers.
Edit to add: now, if you integrate blockchain into your pen trackers, and have an ICO for pencoin, then this is totally fundable. Mid sized retail banks are definitely looking for a way to spend money on blockchain.
The same way it has always worked if you're going to exist on an investor's money: reputation and qualifications. A bit of luck helps as well.
Reputation of course involves things such as your past work experience, your past VC experience, past outcomes, who you've networked with that might refer you to an investor, and so on. This is largely about what you've done and how it forms the opinion of others.
Qualifications is what skills you possess, what you've accomplished, your education, your personal history, etc. This deeply ties into reputation. You can claim to be the greatest programmer ever, that's going to be incredibly difficult to verify for most venture capitalists, most basically won't bother attempting to verify it: they're going to judge you by reputation, partially in tandem with your claims.
Reputation of course involves things such as your past work experience, your past VC experience, past outcomes, who you've networked with that might refer you to an investor, and so on. This is largely about what you've done and how it forms the opinion of others.
Qualifications is what skills you possess, what you've accomplished, your education, your personal history, etc. This deeply ties into reputation. You can claim to be the greatest programmer ever, that's going to be incredibly difficult to verify for most venture capitalists, most basically won't bother attempting to verify it: they're going to judge you by reputation, partially in tandem with your claims.
That lecture was exactly what I needed right now - thank you.
>Also watch the CEO of Segment talk about their journey to product market fit.
this is exactly the lecture that crystallized for me the problems i'm facing (i watched it last sunday). we (full-timers) have no product market fit and we (advisors/investors) are simply plowing ahead (and have been for months) trying to figure out whether that's actually the case or whether we're simply failing as novice entrepreneurs (bad at sales, bad at messaging, etc.)
this is exactly the lecture that crystallized for me the problems i'm facing (i watched it last sunday). we (full-timers) have no product market fit and we (advisors/investors) are simply plowing ahead (and have been for months) trying to figure out whether that's actually the case or whether we're simply failing as novice entrepreneurs (bad at sales, bad at messaging, etc.)
>> the main investors/advisors (from the 220k friends/family/fools round) pretty much feel like it's time to pull the plug
Given your statement above, there's really no question beyond this point. You promised riches and success to family and friends and it is not currently looking like you will do that, and their message is "stop please before its all gone". Do so.
If you still have money and it is from family and friends then stop right now - on Monday (tomorrow) and give back all that you can. If you burn the rest of that cash then for the rest of your life those relationships will exist for you only in the light of that money. It would be different if the money you had was from an angel or VC who are taking calculated risks.
Your family and friends relationships are worth infinitely more than any startup.
You should instantly kill all business costs, go get a job, and continue marketing what you have built on the side.
Given your statement above, there's really no question beyond this point. You promised riches and success to family and friends and it is not currently looking like you will do that, and their message is "stop please before its all gone". Do so.
If you still have money and it is from family and friends then stop right now - on Monday (tomorrow) and give back all that you can. If you burn the rest of that cash then for the rest of your life those relationships will exist for you only in the light of that money. It would be different if the money you had was from an angel or VC who are taking calculated risks.
Your family and friends relationships are worth infinitely more than any startup.
You should instantly kill all business costs, go get a job, and continue marketing what you have built on the side.
Did he promise "riches and success" to family and friends? When I read that part I immediately put myself mentally into those shoes and thought the only honest way to raise money from loved ones is to say "I believe in this project, I want it to succeed, I calculate a reasonable probability of success in which case your investment has the potential to be worth $XYZ. HOWEVER, you should be aware that ALL startups are a total crapshoot, and it's also a very reasonable possibility that you will lose all your money so please do not invest anything that you cannot afford to lose."
We don't know whether OP pitched it this way to friends and family, but I sincerely hope he did.
We don't know whether OP pitched it this way to friends and family, but I sincerely hope he did.
Yeah, the "fools" line is an indicator that you are burned out and have lost your belief in the mission. You'd be lying to yourself and others if you continued.
That's a pretty common expression and probably doesn't indicate anything additional about OP's mindset. https://www.forbes.com/sites/richwinley/2015/08/21/friends-f...
I didn't read the Forbes reference because ad block, but I'm willing to bet that is a pretty common expression among _observers_ of the tech startup/financing scene. Coming from a founder who's been cashing the "fools" checks... well I can only hope it's a lot less common.
Hi, I had a startup fail after we (I had 1 co-founder) invested ~4 years into it. Some thoughts:
A startup failing is not a rational thing. At this time emotions (regret, fear, stress, depression) take over, it's a tough time to handle. If it's tough for you, take comfort in knowing that it's tough for everyone. When I was going through this, I couldn't handle the stress, so it spilled over into my personal life, and in the end I also got divorced a few months after the startup failed. Avoid that by not prolonging the process.
Talking to too many people isn't that helpful. Most "naive" people (who haven't done this, who don't understand how tech companies work, etc) will just tell you to push on. They will do so simply because it's baked into our Culture, that when somebody is in trouble you should be positive to them, tell them not to quit, the way you would fire up a runner at a Marathon race. But a startup is NOT a Marathon race, because training for and finishing a Marathon is purely up to you, but that's simply not true for a startup. (As a Marathon runner, this was one of my misconceptions going into my startup.) Here on HN we're okay with failure, but outside this bubble it's not that okay. So if you talk to people (friends, relatives) you'll get roughly the same if you told them about "I'm dating a girl and it's not working out that great" or "I have a new job but it's not working out that great", most advice would be pretty useless and just along the lines of Try Harder. So you have to learn to ignore these non-expert opinions. The fact that they may be investors sucks.
It sounds like you really don't believe it's going to work out. Don't spend another 3-6 months proving to whoever's left (clients/investors) that it doesn't work, just so they "let you" off the hook. As somebody else said, go on a vacation, and if you still want to stop it, stop it.
One final thing: when I was going through this, I was constantly projecting bad outcomes, which in this first world scenario is a few tough/uncomfortable conversations/situations with people. In the end, some of these happened, but overall it was maybe 1-2 hours worth of conversations, which really weren't that tough/uncomfortable in the end. In retrospect, the fact that I stressed over it 24/7 for months (so, 100s of hours) was really stupid and irrational, so don't do that.
One final trick: imagine yourself 3 years down the line. EVERYTHING WILL BE ALL RIGHT.
Good luck :)
A startup failing is not a rational thing. At this time emotions (regret, fear, stress, depression) take over, it's a tough time to handle. If it's tough for you, take comfort in knowing that it's tough for everyone. When I was going through this, I couldn't handle the stress, so it spilled over into my personal life, and in the end I also got divorced a few months after the startup failed. Avoid that by not prolonging the process.
Talking to too many people isn't that helpful. Most "naive" people (who haven't done this, who don't understand how tech companies work, etc) will just tell you to push on. They will do so simply because it's baked into our Culture, that when somebody is in trouble you should be positive to them, tell them not to quit, the way you would fire up a runner at a Marathon race. But a startup is NOT a Marathon race, because training for and finishing a Marathon is purely up to you, but that's simply not true for a startup. (As a Marathon runner, this was one of my misconceptions going into my startup.) Here on HN we're okay with failure, but outside this bubble it's not that okay. So if you talk to people (friends, relatives) you'll get roughly the same if you told them about "I'm dating a girl and it's not working out that great" or "I have a new job but it's not working out that great", most advice would be pretty useless and just along the lines of Try Harder. So you have to learn to ignore these non-expert opinions. The fact that they may be investors sucks.
It sounds like you really don't believe it's going to work out. Don't spend another 3-6 months proving to whoever's left (clients/investors) that it doesn't work, just so they "let you" off the hook. As somebody else said, go on a vacation, and if you still want to stop it, stop it.
One final thing: when I was going through this, I was constantly projecting bad outcomes, which in this first world scenario is a few tough/uncomfortable conversations/situations with people. In the end, some of these happened, but overall it was maybe 1-2 hours worth of conversations, which really weren't that tough/uncomfortable in the end. In retrospect, the fact that I stressed over it 24/7 for months (so, 100s of hours) was really stupid and irrational, so don't do that.
One final trick: imagine yourself 3 years down the line. EVERYTHING WILL BE ALL RIGHT.
Good luck :)
As someone who worked as a CTO at what I like to call a "zombie" startup I agree with the poster above me, and it hurts just to recollect the history. You can keep this shit up indefinitely. We're in a weird environment where, with enough endurance, a startup, even one with a miserable high touch sales cycle and poor business model, can live month to month like some sort of crime family looking for the next big score.
If you go this route you'll score a contract or two, and you'll think you're growing. You'll hire on a brilliant employee and then fire them a few months later when the money dries up. Your heart will break. Your workload will increase.
You'll start leaning on contractors because FTEs need consistent revenue, and your shit investors insist on offshore labour because they don't know any better. Contractors suck and their code sucks unless supervised, so you'll decide to do it yourself. Your investors will get unhappy and your partner will find another naive low tier investor to buy them out and start the cycle over. Your share in the company will drop each time you do this.
Your counterpart will spend 1/3rd of their time appeasing the investors and the other 2/3rds attempting to be a top shelf B2B sales exec / account manager which they are not. They will get absolutely abused in the sales cycle and concede to shit they shouldn't. You will continue to burn the candle at both ends like a good technical leader in a crisis and then burn out, believing the entire time that technical superiority alone will win the day.
I'm painting a really bleak picture here, but only because I got out after three years of this when I finally realized the nature of the endless cycle of a cockroach startup. The company I worked for is still going, against all odds. Fuck maybe they go forever. I know people who still work there, and from all accounts it's an endless groundhog day of zero growth and pain.
Don't be that startup, if the business model is in peril this early on don't extend the pain, just pull the ripcord and, above all else, try to learn from the experience.
If you go this route you'll score a contract or two, and you'll think you're growing. You'll hire on a brilliant employee and then fire them a few months later when the money dries up. Your heart will break. Your workload will increase.
You'll start leaning on contractors because FTEs need consistent revenue, and your shit investors insist on offshore labour because they don't know any better. Contractors suck and their code sucks unless supervised, so you'll decide to do it yourself. Your investors will get unhappy and your partner will find another naive low tier investor to buy them out and start the cycle over. Your share in the company will drop each time you do this.
Your counterpart will spend 1/3rd of their time appeasing the investors and the other 2/3rds attempting to be a top shelf B2B sales exec / account manager which they are not. They will get absolutely abused in the sales cycle and concede to shit they shouldn't. You will continue to burn the candle at both ends like a good technical leader in a crisis and then burn out, believing the entire time that technical superiority alone will win the day.
I'm painting a really bleak picture here, but only because I got out after three years of this when I finally realized the nature of the endless cycle of a cockroach startup. The company I worked for is still going, against all odds. Fuck maybe they go forever. I know people who still work there, and from all accounts it's an endless groundhog day of zero growth and pain.
Don't be that startup, if the business model is in peril this early on don't extend the pain, just pull the ripcord and, above all else, try to learn from the experience.
> Contractors suck and their code sucks unless supervised
I have worked both as an contractor and as FTE for product/service companies (and startups), and I'm a bit tired with fighting with this prejudice.
The core business of software houses is ... making software, and making it such way that a client is happy with the outcome, pays for what he really need and returns with more projects.
Startups / product companies focus on various business domains and software is a byproduct of their operation. Byproduct that is often driven by chaotic business decisions. Good software houses enforce specification on clients (real specification, not wishes) to make sure they know what they want or need. Good software houses implement and follow correct software development process that enables success of a project (not pseudo Scrum with slapped Kanban sticker on it).
I could can add the many FTEs are stuck for years with deprecated technologies, they don't have practical overview and hand-on experience with new technologies and paid, off the shelf solution. Large part of startups literally burned resources on reinventing wheels, because FTEs where convinced that they can do something better than using a ready solution, or they had no idea that such solution existed.
Software houses are familiar with dozens of technologies because they create and maintain dozens of different, large and small projects from various domains.
I have worked both as an contractor and as FTE for product/service companies (and startups), and I'm a bit tired with fighting with this prejudice.
The core business of software houses is ... making software, and making it such way that a client is happy with the outcome, pays for what he really need and returns with more projects.
Startups / product companies focus on various business domains and software is a byproduct of their operation. Byproduct that is often driven by chaotic business decisions. Good software houses enforce specification on clients (real specification, not wishes) to make sure they know what they want or need. Good software houses implement and follow correct software development process that enables success of a project (not pseudo Scrum with slapped Kanban sticker on it).
I could can add the many FTEs are stuck for years with deprecated technologies, they don't have practical overview and hand-on experience with new technologies and paid, off the shelf solution. Large part of startups literally burned resources on reinventing wheels, because FTEs where convinced that they can do something better than using a ready solution, or they had no idea that such solution existed.
Software houses are familiar with dozens of technologies because they create and maintain dozens of different, large and small projects from various domains.
Most startups fall into one of two categories, either they have the financial side covered or they have the technical side covered, they hardly ever have both.
The financial people need contractors, but they have no clue how to find a decent, honest one, and even if they luck out and find one, they don't know how to work with one. Either way, contractors get a bad rep.
I've seen some horrible ones who honestly deserve a bad reputation and more, but I've also seen some really good ones get a bad reputation due to impossible deadlines, poor or no specification or thrashing due to changing the specification of what should be delivered several times a week.
The financial people need contractors, but they have no clue how to find a decent, honest one, and even if they luck out and find one, they don't know how to work with one. Either way, contractors get a bad rep.
I've seen some horrible ones who honestly deserve a bad reputation and more, but I've also seen some really good ones get a bad reputation due to impossible deadlines, poor or no specification or thrashing due to changing the specification of what should be delivered several times a week.
I think he/she was talking more about hiring cheap freelancers for temp work or engaging in some sort of contractor misclassification due to investor pressure.
Firstly, that was one of the most well written comments I’ve read here.
Secondly, I have seen part of this scenario play out exactly as you stated (hire contractor, fail to deliver, delute investment, repeat); it’s as as if there’s a program to be optionally run by stumbling founders.
Secondly, I have seen part of this scenario play out exactly as you stated (hire contractor, fail to deliver, delute investment, repeat); it’s as as if there’s a program to be optionally run by stumbling founders.
True, i've been doing this shit several times in my life now, from all ends - starting with being 'offshore labor' and ending with being a CTO - all it resonates well with my feelings.
Worst part of it is that, after many years doing this, you get cynical. You starts to feel like every company is a bunch of fools burning money of another bunch of even bigger fools, and let it happen as long as money ends in my pocket.
Right now i don't think i can even think of doing coding as some 'real' thing, which is, done with a real intention of succeeding and bringing in revenue.
Worst part of it is that, after many years doing this, you get cynical. You starts to feel like every company is a bunch of fools burning money of another bunch of even bigger fools, and let it happen as long as money ends in my pocket.
Right now i don't think i can even think of doing coding as some 'real' thing, which is, done with a real intention of succeeding and bringing in revenue.
That – hit too close to home.
I second what you said here. I worked as a CTO of a start up which was primarily driven by ego and lies of the CEO. He didn't want to go a rational way and constantly duped (yes duped) investors.
I took a long time to exit the startup. Reason? Because I was not able to think through it, because when you are so much into something you can't think without it affecting your thoughts. But slowly and steadily I was able to judge the situation by thinking practically (keep thinking, many be write your points, that helps). So for me, best thing was to get out we that company was not going anywhere, may be not the same for you. After four months I joined a very successful bootstrapped startup in tech role. It is an individual contributor role. But I am learning, and preparing for my next feat. Life goes on.
I took a long time to exit the startup. Reason? Because I was not able to think through it, because when you are so much into something you can't think without it affecting your thoughts. But slowly and steadily I was able to judge the situation by thinking practically (keep thinking, many be write your points, that helps). So for me, best thing was to get out we that company was not going anywhere, may be not the same for you. After four months I joined a very successful bootstrapped startup in tech role. It is an individual contributor role. But I am learning, and preparing for my next feat. Life goes on.
I have about 10 years working in the tech side of large B2B events, so comments are based on that.
It’s fine to start a business in an industry you’re not crazy about but most people who make a success this way know there’s a ready and waiting market to earn money in with an existing product. People need plumbers and roofs need tiling.
Most “start-ups” should be founded on the principle of “We’ve identified a problem and we’re the best people to provide the solution” and even then most of them fail. Even pivots are based on that principle (“what we built didn’t solve a problem but we identified another problem we can solve”).
It sounds like you’re gone the route of “I’ve identified a market that I want to provide a solution for.” The events industry is big, which means there are a lot of people thinking the same. During my time I integrated our system with several companies that no longer exist. Many of these products didn’t solve actual attendee or organiser problems or desires and so uptake or return was very low.
Attendee needs are fairly simple and limited (easy to buy tickets, get information about what’s on, and easy conference experience) and they rarely want anything more (e.g. only a tiny fraction or marketing types actually want networking apps).
Conference organiser needs are many and they want to use as few suppliers as possible as each additional supplier means extra work on integration. So most of the businesses doing well in the event space are companies that can provide a large, near holistic product for them which covers a lot of needs. So to complete against them you’ll need a lot more resources than it sounds like you do.
Reading between the lines it sounds like you already know what you need to do. If you’ve lost the drive and conviction that this will be a success then and unless you can find a real problem you can build and sell a solution for quickly and easily, then it’s probably time to call it a day. Try again in a bit and if possible without the pressure of money from family and friends.
It’s fine to start a business in an industry you’re not crazy about but most people who make a success this way know there’s a ready and waiting market to earn money in with an existing product. People need plumbers and roofs need tiling.
Most “start-ups” should be founded on the principle of “We’ve identified a problem and we’re the best people to provide the solution” and even then most of them fail. Even pivots are based on that principle (“what we built didn’t solve a problem but we identified another problem we can solve”).
It sounds like you’re gone the route of “I’ve identified a market that I want to provide a solution for.” The events industry is big, which means there are a lot of people thinking the same. During my time I integrated our system with several companies that no longer exist. Many of these products didn’t solve actual attendee or organiser problems or desires and so uptake or return was very low.
Attendee needs are fairly simple and limited (easy to buy tickets, get information about what’s on, and easy conference experience) and they rarely want anything more (e.g. only a tiny fraction or marketing types actually want networking apps).
Conference organiser needs are many and they want to use as few suppliers as possible as each additional supplier means extra work on integration. So most of the businesses doing well in the event space are companies that can provide a large, near holistic product for them which covers a lot of needs. So to complete against them you’ll need a lot more resources than it sounds like you do.
Reading between the lines it sounds like you already know what you need to do. If you’ve lost the drive and conviction that this will be a success then and unless you can find a real problem you can build and sell a solution for quickly and easily, then it’s probably time to call it a day. Try again in a bit and if possible without the pressure of money from family and friends.
Re: networking
I don’t know how many networking apps (including hardware devices) I’ve seen over the years. They’re at best a novelty and more commonly unwelcome. I suspect the friction with just scribbling down an email, exchanging a business card, or later connecting on LinkedIn is superior to people using the tech to mass spam people.
I don’t know how many networking apps (including hardware devices) I’ve seen over the years. They’re at best a novelty and more commonly unwelcome. I suspect the friction with just scribbling down an email, exchanging a business card, or later connecting on LinkedIn is superior to people using the tech to mass spam people.
That's definitely the case for me. Digging in my pocket, pulling out my phone, searching around for the app while trying to continue to ignore SMS notifications that I'd ignored during our conversation, then getting an error that the app can't connect to the Internet (because the conference Wifi is terrible)... that is so much more of a hassle than reaching into my pocket and exchanging business cards.
For a big event, sorting through the cards after the fact is a little bit of a hassle, but I get to do that on my own time, not when there's a (often rushed) social encounter going on.
For a big event, sorting through the cards after the fact is a little bit of a hassle, but I get to do that on my own time, not when there's a (often rushed) social encounter going on.
Exactly and there are apps to process business cards though I don’t use them enough to bother most of the time and only need one or two pieces of information—and LinkedIn for their faults is mostly my Rolodex anyway.
And, as I say, I strongly suspect I don’t want something that is bump wristbands or something convenient or, worse, doesn’t require my permission at all to add me to some list.
And, as I say, I strongly suspect I don’t want something that is bump wristbands or something convenient or, worse, doesn’t require my permission at all to add me to some list.
Then offer attendees 50 business cards waiting for them at the sign in desk.
what would be the most useful is something which everyone would need to use. phone app that tracked your location and time, and would show you the info on people you stood near for... maybe a min of 30 seconds? location tracking may not be good enough for this indoors all the time, but for me, that's the one thing that I've wanted at conferences - a way to remember who i was talking with without interrupting the conversation to ask for cards/emails (especially in larger group discussions).
Thinking that the answer is making something that everyone "needs" to use is a problem. For example "to enter the conference they need to install this app that also tracks them" is a common thought but it's a bad idea as forcing your end users into a fixed action is bad UX. Mostly it just annoys attendees who will then try and find a workaround.
The result of networking apps is some sales people generate a lot of very low quality leads at the expense of the event's reputation as most delegates don't want spam.
For messaging apps 99% of messages will be sent by 1% of delegates: the pushy sales people. "Hey, want to meet to discuss my amazing product!"
As you say, another option is is "tell me who I was talking to" but again the sales people pollute that experience. B2B events are about selling but there are sales teams who'll scan your badges as they're saying hello (electronically or visually) and then email you forever afterwards. I imagine that "tell me who I stood near" would result in sales teams walking around the entire venue, on the lookup for anyone that looks important to loiter near. Or they could just hide a device in the toilet and get everyone ;)
We tried allowing delegates to build a contact list to message and then also notify when those people were at the same networking event just once. It really wasn't much value to anyone other than, you guessed it, pushy sales people that our VIPs would rather have avoided.
I don't know if it's still the same but Grip's "tinder for events" used to rely on both parties showing mutual interest before allowing communication. That's the best mechanism that I know of but I wouldn't be surprised if the messaging connection rate was incredibly low.
The result of networking apps is some sales people generate a lot of very low quality leads at the expense of the event's reputation as most delegates don't want spam.
For messaging apps 99% of messages will be sent by 1% of delegates: the pushy sales people. "Hey, want to meet to discuss my amazing product!"
As you say, another option is is "tell me who I was talking to" but again the sales people pollute that experience. B2B events are about selling but there are sales teams who'll scan your badges as they're saying hello (electronically or visually) and then email you forever afterwards. I imagine that "tell me who I stood near" would result in sales teams walking around the entire venue, on the lookup for anyone that looks important to loiter near. Or they could just hide a device in the toilet and get everyone ;)
We tried allowing delegates to build a contact list to message and then also notify when those people were at the same networking event just once. It really wasn't much value to anyone other than, you guessed it, pushy sales people that our VIPs would rather have avoided.
I don't know if it's still the same but Grip's "tinder for events" used to rely on both parties showing mutual interest before allowing communication. That's the best mechanism that I know of but I wouldn't be surprised if the messaging connection rate was incredibly low.
"need" wasn't meant in that way (as in, requiring use for access). I was more meaning "the only way what I'm thinking about would work well is that it would require everyone to be using it".
re: emailing - the 'tell me who i was standing near' - yeah, some might abuse it for email. if there was some in-app functionality to allow for 'connecting', both parties might have to agree to 'connect' there to exchange contact info (and yeah, there would still be some social pressure to do so that some people couldn't resist).
Ahh... you just mentioned mutual interest - that's what I was getting at. Yeah, a 'tinder for events', based on geo location/time.
re: emailing - the 'tell me who i was standing near' - yeah, some might abuse it for email. if there was some in-app functionality to allow for 'connecting', both parties might have to agree to 'connect' there to exchange contact info (and yeah, there would still be some social pressure to do so that some people couldn't resist).
Ahh... you just mentioned mutual interest - that's what I was getting at. Yeah, a 'tinder for events', based on geo location/time.
With all due respect, I do not want to be fracking tracked when I'm at an event. And loaded in a database somewhere. I can maybe be persuaded for event organizer use if it's truly anonymous--though given the difficulty of truly anonymizing I'm uncomfortable.
The existence of such data has huge security/privacy implications given that people meet at shows to discuss all sorts of things that aren't on the radar.
Maybe opt-in? I certainly wouldn't.
The existence of such data has huge security/privacy implications given that people meet at shows to discuss all sorts of things that aren't on the radar.
Maybe opt-in? I certainly wouldn't.
I probably didn't clarify enough, just alluded to 'everyone would need to use it'.... and should have added... "but I know that will never happen".
I raised $10M and it wasn’t going to work. We had spent 20%. Board wanted to change course, I said let’s give the money back. I said you’ll have to fire me if you want to keep raising money and change course and they did.
4 years later after they raised another $60M they sold the company for $15M.
Sometimes you don’t win.
Sometimes it’s better to back out and start anew.
Give it all you can but there’s no honor in dying trying for something that won’t work.
There’s a song lyric by Matt Johnson of TheThe:
If you can't change the world. Change yourself. If you can't change the world. Change yourself. And if you can't change yourself....change the world.
If you can change the world I will work with you.
4 years later after they raised another $60M they sold the company for $15M.
Sometimes you don’t win.
Sometimes it’s better to back out and start anew.
Give it all you can but there’s no honor in dying trying for something that won’t work.
There’s a song lyric by Matt Johnson of TheThe:
If you can't change the world. Change yourself. If you can't change the world. Change yourself. And if you can't change yourself....change the world.
If you can change the world I will work with you.
“The reasonable man adapts himself to the world: the unreasonable one persists in trying to adapt the world to himself. Therefore all progress depends on the unreasonable man.”
― George Bernard Shaw
― George Bernard Shaw
"I don't start new businesses: I let other fellows start them. They put all their money and their friends' money into starting them. They wear out their souls and bodies trying to make a success of them. They're what you call enthusiasts. But the first dead lift of the thing is too much for them; and they haven't enough financial experience. In a year or so they have either to let the whole show go bust, or sell out to a new lot of fellows for a few deferred ordinary shares: that is, if they're lucky enough to get anything at all. As likely as not the very same thing happens to the new lot. They put in more money and a couple of years' more work; and then perhaps they have to sell out to a third lot. If it's really a big thing the third lot will have to sell out too, and leave their work and their money behind them. And that's where the real business man comes in: where I come in." -- George Bernard Shaw, Heartbreak House, 1916
This quote is so uncanny in its relevance to investors/entrepreneurs and the topic at hand. At first I couldn't believe it was not satire. The character continues:
"But I'm cleverer than some; I don't mind dropping a little money to start the process. I took your father's measure. I saw that he had a sound idea, and that he would work himself silly for it if he got the chance. I saw that he was a child in business, and was dead certain to outrun his expenses and be in too great a hurry to wait for his market. I knew that the surest way to ruin a man who doesn't know how to handle money is to give him some. I explained my idea to some friends in the city, and they found the money; for I take no risks in ideas, even when they're my own. Your father, and the friends that ventured their money with him were no more to me than a heap of squeezed lemons."
"But I'm cleverer than some; I don't mind dropping a little money to start the process. I took your father's measure. I saw that he had a sound idea, and that he would work himself silly for it if he got the chance. I saw that he was a child in business, and was dead certain to outrun his expenses and be in too great a hurry to wait for his market. I knew that the surest way to ruin a man who doesn't know how to handle money is to give him some. I explained my idea to some friends in the city, and they found the money; for I take no risks in ideas, even when they're my own. Your father, and the friends that ventured their money with him were no more to me than a heap of squeezed lemons."
This quote is the mantra of the Unreasonable Group, an impact-oriented organization that helps startups solve “big f’ing problems”. They are awesome!
http://Unreasonable.is.
http://Unreasonable.is.
I don't know anything about this.
Is selling the company for 15M a win? Or a loss because of the 60m raised?
Is selling the company for 15M a win? Or a loss because of the 60m raised?
I'm on year 2 of my startup, and around month 9, I felt similar to you, so I can relate. Real traction began around month 20, and its still modest. Here are a couple of issues I see:
1. 9 months isn't long enough, as others have said. There are exceptions, but those are the exceptions. I can't think of any startup in recent history truly reaching product/market fit within its first couple of years. Facebook, I guess. It's not abnormal for it to not happen years out. pmarca's material on it suggests this, as well.
2. You not only raised money very early, but you raised it from non-professional investors, as far as I can tell, so you're un-nerved about losing their money, while they want to push you to turn their thousands into millions. Raising more money at this point is only going to exacerbate everything you're going through.
3. High-touch sales are absolutely the norm in B2B. Your efforts are a good thing. If you take a lot of the typical YC advice at face value, you'll be lead to believe that you should be measuring your conversions, etc, and having a nice hockey-stick shaped growth curve. This is absolutely not going to be the case for a B2B company on month 9, unless they've struck platinum. There was a startup school segment where Kevin Hale (IIRC) advised the founders not to measure sales, since they'd likely be in the single digits for the first year and not yield anything meaningful. Instead, you should be measuring your own outreach. Any other metric is going to be close enough to zero to be meaningless at this stage. Your product is going to be crappy, your presentations and pitches are going to be awkward and sloppy.
At the end of the day, you have the best idea of your chances for survival. With what you've mentioned so far, there's promise, but it'll be up to you to make it happen. Even if you stick it out for a year or two longer, the odds, of course, are still against you.
1. 9 months isn't long enough, as others have said. There are exceptions, but those are the exceptions. I can't think of any startup in recent history truly reaching product/market fit within its first couple of years. Facebook, I guess. It's not abnormal for it to not happen years out. pmarca's material on it suggests this, as well.
2. You not only raised money very early, but you raised it from non-professional investors, as far as I can tell, so you're un-nerved about losing their money, while they want to push you to turn their thousands into millions. Raising more money at this point is only going to exacerbate everything you're going through.
3. High-touch sales are absolutely the norm in B2B. Your efforts are a good thing. If you take a lot of the typical YC advice at face value, you'll be lead to believe that you should be measuring your conversions, etc, and having a nice hockey-stick shaped growth curve. This is absolutely not going to be the case for a B2B company on month 9, unless they've struck platinum. There was a startup school segment where Kevin Hale (IIRC) advised the founders not to measure sales, since they'd likely be in the single digits for the first year and not yield anything meaningful. Instead, you should be measuring your own outreach. Any other metric is going to be close enough to zero to be meaningless at this stage. Your product is going to be crappy, your presentations and pitches are going to be awkward and sloppy.
At the end of the day, you have the best idea of your chances for survival. With what you've mentioned so far, there's promise, but it'll be up to you to make it happen. Even if you stick it out for a year or two longer, the odds, of course, are still against you.
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One thing I learned about startups is that you have to detach yourself from the success and failure of your work and concentrate on two things:
The first is runway. How much time and resources do you have? How are you generating runway? Runway is the master summary of your revenue, expenses, and investment. If you are good at managing runway, you can exist forever until you find a good idea. Being good at runway is knowing when to raise, when to focus on revenue, and when to invest.
The second is willpower. This is not motivation. Your willpower should be a combination of many things - your stubborn personality maybe, your insistence on finding a solution, your determination to succeed, your obsession with the space that you are working in. Motivation should never be relied on as it's an emotional state and not a character trait.
Willpower is your tank size. Morale is how much fuel is left. Make sure to upgrade your tank and keep it full.
Managing these two things is the primary goal of founders. Finding product market fit is the goal of a startup, but your responsibility as part of the founding team is, using the runway you have, to maximize the combination of time, skillsets and expertise to generate as much forward moving business activity that you can.
As a founder, you should also get into fighting shape. This means that you need to step back and look at yourself. Learn to detach yourself emotionally from failures and success; none of that matters, there is only your current state of productivity.
And learn to guard the resources that matter; specifically in this case, your morale. It's run dangerously low. When it is this low, you can be unconsciously reducing the morale of the team as well, which you should never do. (If you quit, quit gracefully, don't drag the team morale down in order to shut down).
The first is runway. How much time and resources do you have? How are you generating runway? Runway is the master summary of your revenue, expenses, and investment. If you are good at managing runway, you can exist forever until you find a good idea. Being good at runway is knowing when to raise, when to focus on revenue, and when to invest.
The second is willpower. This is not motivation. Your willpower should be a combination of many things - your stubborn personality maybe, your insistence on finding a solution, your determination to succeed, your obsession with the space that you are working in. Motivation should never be relied on as it's an emotional state and not a character trait.
Willpower is your tank size. Morale is how much fuel is left. Make sure to upgrade your tank and keep it full.
Managing these two things is the primary goal of founders. Finding product market fit is the goal of a startup, but your responsibility as part of the founding team is, using the runway you have, to maximize the combination of time, skillsets and expertise to generate as much forward moving business activity that you can.
As a founder, you should also get into fighting shape. This means that you need to step back and look at yourself. Learn to detach yourself emotionally from failures and success; none of that matters, there is only your current state of productivity.
And learn to guard the resources that matter; specifically in this case, your morale. It's run dangerously low. When it is this low, you can be unconsciously reducing the morale of the team as well, which you should never do. (If you quit, quit gracefully, don't drag the team morale down in order to shut down).
>to last minute catastrophic product failures
You have to have a product that works. People are trusting part of their business to your software. Depending on your software, they also have to spend a lot of time and money with integrations, training and all that. It's a large commitment that isn't easy to reverse.
If your software was working perfectly and provided obvious, quantifiable value, do you think you would have reeled in those clients? If so, slow down the features and concentrate on stabilizing the software. To do this effectively you need to have both an eagle-eye QA person/team and an existing beta client. The more beta clients the better, because people will use (and break) your stuff in ways no one in your company imagined. While you are doing this, make sure the people who are demoing it know a happy path and are disciplined enough to stick to that and can explain away the problems. For them to be able to do that, you have to have a committed relationship with them, especially before demos. You also need to be in constant communication with your clients and make sure they know you are turning things around. You need to show them proof with quick releases on the most painful items and constant improvement. Proper triage is big in the beginning and majority of this phase.
You also might want to ask your investors who are bullish on the product if any of their other investment companies or connections have any need for your software. They usually have connections that you and I probably wouldn't.
That's the best advice I can give given my experience. There is a lot more in the details but that's the top points. I've been the head technical person in 2 turnarounds now, but they had existing (but angry and fleeing) clients. We had the software stabilized within a year, but it's a grueling process. Expect nights and weekends for the first 3-6 months, depending on where you are, then things will go more smoothly.
You have to have a product that works. People are trusting part of their business to your software. Depending on your software, they also have to spend a lot of time and money with integrations, training and all that. It's a large commitment that isn't easy to reverse.
If your software was working perfectly and provided obvious, quantifiable value, do you think you would have reeled in those clients? If so, slow down the features and concentrate on stabilizing the software. To do this effectively you need to have both an eagle-eye QA person/team and an existing beta client. The more beta clients the better, because people will use (and break) your stuff in ways no one in your company imagined. While you are doing this, make sure the people who are demoing it know a happy path and are disciplined enough to stick to that and can explain away the problems. For them to be able to do that, you have to have a committed relationship with them, especially before demos. You also need to be in constant communication with your clients and make sure they know you are turning things around. You need to show them proof with quick releases on the most painful items and constant improvement. Proper triage is big in the beginning and majority of this phase.
You also might want to ask your investors who are bullish on the product if any of their other investment companies or connections have any need for your software. They usually have connections that you and I probably wouldn't.
That's the best advice I can give given my experience. There is a lot more in the details but that's the top points. I've been the head technical person in 2 turnarounds now, but they had existing (but angry and fleeing) clients. We had the software stabilized within a year, but it's a grueling process. Expect nights and weekends for the first 3-6 months, depending on where you are, then things will go more smoothly.
>You have to have a product that works.
it was completely outside the scope of my product. we have a mobile webapp that doesn't work in a uiwebview (ios). simple solution: pop out safari from a button. catastrophic failure: conference apps insist on keeping users in app and so those buttons load up the site in a uiwebview. in fact at the last moment (one day before the conference) i figured out a pretty viable solution, slapped it together in 6 hours, made calls to make appropriate changes on site (at the conference), and it should've gone okay.
>quantifiable value
this is what i think we're missing
it was completely outside the scope of my product. we have a mobile webapp that doesn't work in a uiwebview (ios). simple solution: pop out safari from a button. catastrophic failure: conference apps insist on keeping users in app and so those buttons load up the site in a uiwebview. in fact at the last moment (one day before the conference) i figured out a pretty viable solution, slapped it together in 6 hours, made calls to make appropriate changes on site (at the conference), and it should've gone okay.
>quantifiable value
this is what i think we're missing
It’s totally inside the scope of your product to work. You sold someone on your expertise and ability, but hadn’t done enough homework to know that your web app wouldn’t work in one of the most important ways their customers would interact with it?
There’s a lot to learn here, but step one is owning up to your own mistakes and not blaming others.
There’s a lot to learn here, but step one is owning up to your own mistakes and not blaming others.
I did know and it was exactly why I warned that customer that a uiwebview wouldn't work and that they needed a button. what I didn't know (because I was not privy to their conversations with their other app provider) was that that button could only open a uiwebview.
I'd give the somewhat cliched advice of whether you believe you will fail, or believe you can succeed... you are correct.
If you do choose to go forward, the fact that you have failed so far is not relevant. You had pilots. They failed. You know why. Dig deeper into the causes of the failures. Fix them. Get feedback from the customers, and fix the product. Fix the operational issues. And try again.
That is no different than the actions you would have taken from a successful pilot -- to listen to the customers, evaluate what happened, improve on it, and do it again. Iterating on a product is a process that doesn't end. You always take a step forward, no matter where you are today, and you end up in a better place in the future.
Whether or not to walk that path is completely up to you.
If you do choose to go forward, the fact that you have failed so far is not relevant. You had pilots. They failed. You know why. Dig deeper into the causes of the failures. Fix them. Get feedback from the customers, and fix the product. Fix the operational issues. And try again.
That is no different than the actions you would have taken from a successful pilot -- to listen to the customers, evaluate what happened, improve on it, and do it again. Iterating on a product is a process that doesn't end. You always take a step forward, no matter where you are today, and you end up in a better place in the future.
Whether or not to walk that path is completely up to you.
Most times there are shades of the true answer spread across multiple HN comments. That isn’t true here. This (the comment I’m replying to) is the only realistic way of looking at it. You need raw grit. My brother hit his tendon with a hatchet an 8 hour hike from civilization deep in the Canadian wilderness. He hiked back. Every step hurt. Sometimes you just need to move forward step by painful step. If you don’t you will fail. Sometimes it’s ok to fail. Sometimes it’s not. If not, just keep moving forward.
If the alternative is to lie down and die, yes, it totally makes sense to grit it out.
If the alternative is to get a cushy job at Google... spending a lot more time failing to run a company is often a bad idea for all involved. I personally spent a decade of my career trying to run a business, and it turns out? I'm just not very good at running a business. Had I worked regular jobs during that time, while living on what I lived on? I'd have enough money to retire at this point.
You need to be mindful of your opportunity cost... sure, if you are management material, you can probably pull some of your experience running the failed company into your next job. If you are looking for an individual contributor job, though? Running a business that only did okay looks to future employers a lot like unemployment.
If the alternative is to get a cushy job at Google... spending a lot more time failing to run a company is often a bad idea for all involved. I personally spent a decade of my career trying to run a business, and it turns out? I'm just not very good at running a business. Had I worked regular jobs during that time, while living on what I lived on? I'd have enough money to retire at this point.
You need to be mindful of your opportunity cost... sure, if you are management material, you can probably pull some of your experience running the failed company into your next job. If you are looking for an individual contributor job, though? Running a business that only did okay looks to future employers a lot like unemployment.
I know a team who completely threw out their original idea and a co-founder after 6 months. They started from scratch and created a company with a $1m run rate revenue after 5 years.
Right now you have a team and funding. That's normally really hard to setup i.e. persuading people to join you to start a company and get funding. Take what you have and run with it. You might need to change the product or dump it all together.
Right now you have a team and funding. That's normally really hard to setup i.e. persuading people to join you to start a company and get funding. Take what you have and run with it. You might need to change the product or dump it all together.
Brutal truth:
You have zero confidence in your own product.
So yes, shut this down as gracefully as possible.
Taking on the entire world is hard enough even if you do believe in your product.
You have zero confidence in your own product.
So yes, shut this down as gracefully as possible.
Taking on the entire world is hard enough even if you do believe in your product.
Good advice, but it's not that OP has 'zero confidence' in the product. He/she says how it failed the most important test.
>... in my understanding we've failed at the most important thing: finding product/market fit
>... in my understanding we've failed at the most important thing: finding product/market fit
How is that not zero confidence?
They built something, sure, but the technical cofounder believes it has very little/no utility. That's telling.
They built something, sure, but the technical cofounder believes it has very little/no utility. That's telling.
Having confidence in something, and finding out that your target audience doesn't want it, or need it are 2 entirely different things.
Per his OP, the technical founder has not explicitly stated whether he believes that the product has zero utility. Rather he's saying that he found out (from data I suppose) that there is no product market fit for it.
Per his OP, the technical founder has not explicitly stated whether he believes that the product has zero utility. Rather he's saying that he found out (from data I suppose) that there is no product market fit for it.
Isn't "no product market fit" and "zero utility" pretty much the same thing for a startup? OK, there are things that have some utility for some people but (almost) nobody is willing to pay for that, but for a startup, that's as good as zero utility, if there's no market, then the thing is worthless.
> Having confidence in something, and finding out that your target audience doesn't want it, or need it are 2 entirely different things.
Splitting hairs IMHO.
Splitting hairs IMHO.
no i don't believe in the product and i'm not wrong for not being slavishly committed to it
https://www.google.com/search?q=don%27t+fall+in+love+with+yo...
i do believe in the problem though
https://www.google.com/search?q=don%27t+fall+in+love+with+yo...
i do believe in the problem though
This makes sense. If you still believe in problem, why not hit refresh. Start a solution that feels right this time. A pivot that doesn't cost a lot of .
I was at a startup in edu tech. Half way through I realised the product wasn't the solution but a major change in our approach could have worked out. Sadly no one let me near this idea. The company is still burning cash.
Time is an even scarcer resource than money.
You don't have much money.
You don't believe in your product.
All signs point negative.
If you're looking for permission to cut loose, you have it. Work on something you believe in. Don't waste any more time on an unworkable startup.
You don't have much money.
You don't believe in your product.
All signs point negative.
If you're looking for permission to cut loose, you have it. Work on something you believe in. Don't waste any more time on an unworkable startup.
Agreed. There’s no shame in pulling the plug at this point, in fact it’s the honorable thing to do.
Be more optimistic, it’s easy to be negative. This is what I took from being a startup employee when I was an aspiring founder.
I went from a science undergrad (with some coding for simulations of experiments) to SWE at a startup where everyone knew each other. It was a very convivial and trusting atmosphere. Eventually I made charts for board meetings, and dug into the financial data. I was so surprised! So much churn, so few customers, so few sales, so much support and work per customer, all at a 3yo startup. I knew the last round of funding money was drying up, and I thought, man, this thing is gunna end. But money came through, many rounds more. At every time I talked with the cofounders and anyone like investors or board members at the company, wow, optimism.
My lesson was that I was too skeptical from the natural sciences. Businesses are about people, and people can be convinced, some immediately, some over time, or since there are a lot of people and a lot of money in the world, you might find more receptive people and money later. So it is about putting on the face and convincing whoever with confidence (if that is what you’re into).
So cheer up dude, you made it his far, you can keep going. I moved away from my company to my own hustle, but man, that company is a boomin. I won’t say if it’s profitable, but it’s a great place to work, everyone is happy, somehow investors still seem super happy, more people are being hired, and there is some customer testimony that is very positive.
I think there is a difference between a startup and a business, made possible by the swell of VCs, and this means you can chase your dream longer, as long as you find the right investors.
I went from a science undergrad (with some coding for simulations of experiments) to SWE at a startup where everyone knew each other. It was a very convivial and trusting atmosphere. Eventually I made charts for board meetings, and dug into the financial data. I was so surprised! So much churn, so few customers, so few sales, so much support and work per customer, all at a 3yo startup. I knew the last round of funding money was drying up, and I thought, man, this thing is gunna end. But money came through, many rounds more. At every time I talked with the cofounders and anyone like investors or board members at the company, wow, optimism.
My lesson was that I was too skeptical from the natural sciences. Businesses are about people, and people can be convinced, some immediately, some over time, or since there are a lot of people and a lot of money in the world, you might find more receptive people and money later. So it is about putting on the face and convincing whoever with confidence (if that is what you’re into).
So cheer up dude, you made it his far, you can keep going. I moved away from my company to my own hustle, but man, that company is a boomin. I won’t say if it’s profitable, but it’s a great place to work, everyone is happy, somehow investors still seem super happy, more people are being hired, and there is some customer testimony that is very positive.
I think there is a difference between a startup and a business, made possible by the swell of VCs, and this means you can chase your dream longer, as long as you find the right investors.
First of all: honor to your for the courage of founding and running a startup. Being a founder myself, I know how hard it is compared to many other alternatives.
Second: I doubt you "have failed to learn anything valuable". If you sit down, take pen and paper, and try to list things you've learned since the beginning, I bet you that you'll come with several items in just half an hour.
But, to your point: you want to shut down and return ~half the money to investors. That's very responsible. Others would like to continue pushing, possibly to get to a point where you can raise a larger round.
I have to say, it's hard to find PMF (Product-Market Fit) just by spending $120k in a few months. The fact that you haven't found it yet does not mean you're not on the right path.
You have been vague (I guess you don't want to give away too much about the company identity), so it becomes hard for people like me (and I guess others) to try to help you in a meaningful way.
The only real piece of advice that I want to give you is this: when you have a strong feeling about a decision, when it comes from deep inside you, don't ignore that voice. Somehow, we tend to know what's the right choice even if rationally we think we don't.
Second: I doubt you "have failed to learn anything valuable". If you sit down, take pen and paper, and try to list things you've learned since the beginning, I bet you that you'll come with several items in just half an hour.
But, to your point: you want to shut down and return ~half the money to investors. That's very responsible. Others would like to continue pushing, possibly to get to a point where you can raise a larger round.
I have to say, it's hard to find PMF (Product-Market Fit) just by spending $120k in a few months. The fact that you haven't found it yet does not mean you're not on the right path.
You have been vague (I guess you don't want to give away too much about the company identity), so it becomes hard for people like me (and I guess others) to try to help you in a meaningful way.
The only real piece of advice that I want to give you is this: when you have a strong feeling about a decision, when it comes from deep inside you, don't ignore that voice. Somehow, we tend to know what's the right choice even if rationally we think we don't.
First of all, don't worry too much. It took me 10 years and 2 startup failures before building one that is now > 10M€ in revenue. So failing is part of the process.
Here is what I'd recommend: 1) take a week off and rest. The startup way of life is very demanding and being exhausted can impair your judgment to answer the very importance question that all founders face at some time: Should I quit? Or should I pivot? Or should I persevere. 2) evaluate what I believe is the most important startup metrics: market traction. After so much cash burned, you should have at least an idea if your solution is truly disruptive or if it is just 'nice to have'. If it is 'nice to have' I recommend you quit. 3) if you decide to quit or are not sure, return the money to the investors in order to preserve your credibility for any future venture project.
Remember that being an entrepreneur is not a one-shot journey. It's a way of life. With time and experience you will get better at it.
Here is what I'd recommend: 1) take a week off and rest. The startup way of life is very demanding and being exhausted can impair your judgment to answer the very importance question that all founders face at some time: Should I quit? Or should I pivot? Or should I persevere. 2) evaluate what I believe is the most important startup metrics: market traction. After so much cash burned, you should have at least an idea if your solution is truly disruptive or if it is just 'nice to have'. If it is 'nice to have' I recommend you quit. 3) if you decide to quit or are not sure, return the money to the investors in order to preserve your credibility for any future venture project.
Remember that being an entrepreneur is not a one-shot journey. It's a way of life. With time and experience you will get better at it.
You might want to seek out some folks at Crowdcompass or other companies in your general category and see if they want to hire your whole team, maybe even pay you to continue doing what you're doing... that's kind of a middle option. If you decide not to move forward I'd be glad to consider you for a job at our company because I respect how you're handling this. Whatever you do I wish you the best of luck. If you'd like to chat I'm at... dave <at>sendsmart.com.
Whether you should quit or not depends on (a) whether your idea has any potential and (b) whether you're suited to starting a startup. It's hard to tell either of those from your question.
The question I'd ask is, why did you start working on this idea? Was it something you yourselves needed? Or was it a made-up idea, meaning something you assumed other people wanted (but that perhaps they don't actually)?
If the answer is the former, focus on the problem you know exists from your own experience, and find the people who desperately need it. If you did, there must be others.
If the answer is the latter – that you're making something you hoped and predicted other people would want – then you're basically casting about at random. And though I resist ever advising people to quit, if there's a time to, that's it.
The question I'd ask is, why did you start working on this idea? Was it something you yourselves needed? Or was it a made-up idea, meaning something you assumed other people wanted (but that perhaps they don't actually)?
If the answer is the former, focus on the problem you know exists from your own experience, and find the people who desperately need it. If you did, there must be others.
If the answer is the latter – that you're making something you hoped and predicted other people would want – then you're basically casting about at random. And though I resist ever advising people to quit, if there's a time to, that's it.
I’ve been in a similar position as you. I’ve spent the last 8 years building a b2b company. It’s a hard long road. I can hear the unspoken panic in your writing. It feels like you are flailing around and giving up already. You really need to analyze the reason you guys are failing without all the emotion if possible. You say that you didn’t learn anything valuable. That is absolutely not true. Think back to why you thought this was a good idea in the first place. Think about all the lessons learned with your failures. You actually got people to do some pilots. Making money is freakin hard. Ignore the prsssure from investors for a moment. They knew they could lose their money. You need to personally decide if you keep going or do something else. I can promise you it won’t get any easier though if you stay in the startup world.
One of the most important things I learned while being in a somewhat similar position as you a little while ago, is to stop concentrating on sales at this juncture, and concentrate on the product instead.
As a solo-cofounder, your focus will keep shifting from sales to engineering, and it's very very hard to do both. I recommend stopping all new sales, align your entire company on stabilizing the product, and your existing customers will become your sales team.
As others have said, it would be helpful to take a break with your team, craft a new product-focussed strategy, and make deadlines for delivery.
Lastly, remember that you've actually achieved a lot (getting paid pilots is hard as a startup). Even if you do quit (I recommend giving it some more time though), I think you have learned what NOT to do in your next venture. Good luck!
As a solo-cofounder, your focus will keep shifting from sales to engineering, and it's very very hard to do both. I recommend stopping all new sales, align your entire company on stabilizing the product, and your existing customers will become your sales team.
As others have said, it would be helpful to take a break with your team, craft a new product-focussed strategy, and make deadlines for delivery.
Lastly, remember that you've actually achieved a lot (getting paid pilots is hard as a startup). Even if you do quit (I recommend giving it some more time though), I think you have learned what NOT to do in your next venture. Good luck!
It seems like you have had some progress but lack strategy, or a vision - ie what is your business here to solve. So instead you are placing lots of bets to see what works.
Look up the EOS methodology, or read the book Traction by Gabriel Weinberg, it’s a good read with lots of helpful tools.
Ultimately if you like your team, want to do something to change the world, have the support of your backers, perhaps do some services consulting and sell your time for money.
This approach will give you income, and at the same time you can start noticing problems in your clients you can help them solve with a product.
It’s the easiest way to get started, and the revenue provides you a longer runway. The client logo’s and case studies help with your credibility too.
Look up the EOS methodology, or read the book Traction by Gabriel Weinberg, it’s a good read with lots of helpful tools.
Ultimately if you like your team, want to do something to change the world, have the support of your backers, perhaps do some services consulting and sell your time for money.
This approach will give you income, and at the same time you can start noticing problems in your clients you can help them solve with a product.
It’s the easiest way to get started, and the revenue provides you a longer runway. The client logo’s and case studies help with your credibility too.
>This approach will give you income, and at the same time you can start noticing problems in your clients you can help them solve with a product.
this has occurred to me
this has occurred to me
Don’t stress as much about investor capital as about your own time. Investors probably like what you are doing and they probably have (more or less) plenty of capital or they wouldn’t have given to you. They mostly won’t want their money back pro-rated if there is an option for your team to keep trying hard.
You have finite time on this earth. If this startup is no longer the right thing to be spending your time on, if you don’t think this or anything like it will work, then it is reasonable to quit and do something else. But I would second other people’s suggestion that you take a week or two to recover from what seems like burnout and seriously consider what the right next thing to do is and whether this corporate vehicle and these investors are part of the answer.
You have finite time on this earth. If this startup is no longer the right thing to be spending your time on, if you don’t think this or anything like it will work, then it is reasonable to quit and do something else. But I would second other people’s suggestion that you take a week or two to recover from what seems like burnout and seriously consider what the right next thing to do is and whether this corporate vehicle and these investors are part of the answer.
There is quite a bit of advice in this thread, some by people who've been in your shoes and some who haven't. So be careful about the advice you follow, it's easy to make a bad decision at this point in a startup.
My advice. Go (back) to consultant mode. It failed. You know this, it's in the OP. Don't give back the cash, they invested in your ability to grow something. Show them they didn't make a mistake. Work on something totally new and don't feel constrained to do something anything even remotely close to the old idea. Don't start building another software monstrosity. Find a real problem and a way to solve it. You have a year of runaway to sell something that can grow into something real. That's not too bad.
My advice. Go (back) to consultant mode. It failed. You know this, it's in the OP. Don't give back the cash, they invested in your ability to grow something. Show them they didn't make a mistake. Work on something totally new and don't feel constrained to do something anything even remotely close to the old idea. Don't start building another software monstrosity. Find a real problem and a way to solve it. You have a year of runaway to sell something that can grow into something real. That's not too bad.
Do you think the new cofounder will substantially change your ability to have 5 successful pilots in the next 3 months?
Are you excited about the space? Do you think you are uniquely able to contribute? Do you still think the market is there?
If your answer are no to all or most of the above, it sounds like maybe you should close up shop. I think returning VC money is dumb. Returning friends & family might be worthwhile.
Are you excited about the space? Do you think you are uniquely able to contribute? Do you still think the market is there?
If your answer are no to all or most of the above, it sounds like maybe you should close up shop. I think returning VC money is dumb. Returning friends & family might be worthwhile.
>Do you think the new cofounder will substantially change your ability to have 5 successful pilots in the next 3 months?
substantially? hard to tell. he is hungry, and smart enough (from what i can tell), but he's no magician (who is anyway?).
>Are you excited about the space?
no. we are not building tesla-spacex-oculus. it would be very hard to be excited about b2b tradeshows. i am excited about potentially building a successful business.
>Do you think you are uniquely able to contribute?
not as of yet.
>Do you still think the market is there?
yes.
>I think returning VC money is dumb. Returning friends & family might be worthwhile.
there is no traditional vc money. it is only fff money.
substantially? hard to tell. he is hungry, and smart enough (from what i can tell), but he's no magician (who is anyway?).
>Are you excited about the space?
no. we are not building tesla-spacex-oculus. it would be very hard to be excited about b2b tradeshows. i am excited about potentially building a successful business.
>Do you think you are uniquely able to contribute?
not as of yet.
>Do you still think the market is there?
yes.
>I think returning VC money is dumb. Returning friends & family might be worthwhile.
there is no traditional vc money. it is only fff money.
> it would be very hard to be excited about b2b tradeshows.
I worked in the technology side of large B2B events for about 10 years and there are certainly people who get really excited about B2B events!
You don't have to LOVE your product or industry but you've got to be interested in the industry and believe in your product. Being disinterested in the industry is a big disadvantage. Most people coming up with ideas or solutions are deeply involved in their industry and interested enough to spend a lot of time thinking about it.
I worked in the technology side of large B2B events for about 10 years and there are certainly people who get really excited about B2B events!
You don't have to LOVE your product or industry but you've got to be interested in the industry and believe in your product. Being disinterested in the industry is a big disadvantage. Most people coming up with ideas or solutions are deeply involved in their industry and interested enough to spend a lot of time thinking about it.
>Are you excited about the space?
no. we are not building tesla-spacex-oculus. it would be very hard to be excited about b2b tradeshows. i am excited about potentially building a successful business.
There you go. Quit. I'd wage my life you wont make it. The only way to do something amazing is to love what you're doing.
There you go. Quit. I'd wage my life you wont make it. The only way to do something amazing is to love what you're doing.
Have you made progress in trying to understand your customers and their problems?
You mentioned that 1 or more customers in the pilot are paid-customers. If someone is paying you, either they are forking out the money in the hope that you're going to solve a problem for them or they are forking over the money for other reasons (ex. as a favor to you or due to past relationship.)
Do you understand why the paid pilot customers were willing to pay you?
You mentioned that 1 or more customers in the pilot are paid-customers. If someone is paying you, either they are forking out the money in the hope that you're going to solve a problem for them or they are forking over the money for other reasons (ex. as a favor to you or due to past relationship.)
Do you understand why the paid pilot customers were willing to pay you?
the pilots that signed with us signed because the pain point is real and we did a good job pitching them/they are extraordinarily impressionable. the problem is that a key assumption necessary in actually delivering value turned out to be pretty much false (basically we saw almost no adoption amongst users).
> a key assumption necessary in actually delivering value turned out to be pretty much false (basically we saw almost no adoption amongst users).
I'm leaning out on a limb here, but if this means what I think it means, you have developed some app that tradeshow visitors are asked to install to reap some benefits that don't interest them. If that's kind of what you are doing, pull the plug now. People don't use that kind of thing.
I'm leaning out on a limb here, but if this means what I think it means, you have developed some app that tradeshow visitors are asked to install to reap some benefits that don't interest them. If that's kind of what you are doing, pull the plug now. People don't use that kind of thing.
you're very close and
>People don't use that kind of thing.
is exactly one of the key hypotheses that needed validation/falsification. what we are facing now is whether we really falsified it given poor marketing/education on the part of the organizer.
>People don't use that kind of thing.
is exactly one of the key hypotheses that needed validation/falsification. what we are facing now is whether we really falsified it given poor marketing/education on the part of the organizer.
I worked in this market for a long time, and the biggest single problem with making software for conferences is that your users aren't your customers. Furthermore, your customers only have a rough understanding of what the users might want. Event attendees don't tend to provide detailed feedback to organizers.
This is why event apps tend to suck -- they're designed to appeal to people who aren't going to use them. To be successful, you have to actually figure out what users want _and_ convince your customers that you know better than them. This is incredibly difficult.
Also, organizers generally aren't invested in promoting your product. They buy your product in the hope that it will magically make their event more successful. It takes a lot of one-on-one training and coaxing to get most of them to participate. This is an extremely support-heavy market, and thus labor-intensive. Even as a startup, you rapidly end up needing dedicated customer support staff.
Also also, as it seems you discovered, there are a ton of pitfalls with building a product that is intended to be used by large groups of people, all at once, in a time-sensitive context, in a single enclosed environment, on their variously capable mobile phones. That makes failures nearly always catastrophic, and it erodes the average experience as well -- there's always people with some sort of bizarre cheapo phone that breaks in obscure ways, and those people also complain loudly and frequently.
This is why event apps tend to suck -- they're designed to appeal to people who aren't going to use them. To be successful, you have to actually figure out what users want _and_ convince your customers that you know better than them. This is incredibly difficult.
Also, organizers generally aren't invested in promoting your product. They buy your product in the hope that it will magically make their event more successful. It takes a lot of one-on-one training and coaxing to get most of them to participate. This is an extremely support-heavy market, and thus labor-intensive. Even as a startup, you rapidly end up needing dedicated customer support staff.
Also also, as it seems you discovered, there are a ton of pitfalls with building a product that is intended to be used by large groups of people, all at once, in a time-sensitive context, in a single enclosed environment, on their variously capable mobile phones. That makes failures nearly always catastrophic, and it erodes the average experience as well -- there's always people with some sort of bizarre cheapo phone that breaks in obscure ways, and those people also complain loudly and frequently.
1.) Selling to a customer is hard.
2.) Selling to a customer that must then sell your product to its customer is at least an order of magnitude harder, and may be one of the hardest tricks for a new business to pull-off successfully.
Simply put, you don't have the branding to convert the end customer nor the control over that second sales process. Compounding this is that your product is not a priority for your direct customer and is not mission-critical to them in addressing their actual priorities. Thus, they will not engage nearly the focus required to address item 1 above in selling your product to its customers (i.e. end-users).
This last point can't be stressed enough. As entrepreneurs, our products are our focus and we tend to project that priority onto others.
The only way this model will work is if:
a.) The product is extraordinarily compelling/valuable to the end user in the same sense as would form the basis for building any viable business
AND
b.) The product is easy for your customer to sell to the end user in a frictionless manner (easy to communicate, requires no onboarding or support from your customer, etc.)
AND EITHER:
c.) Your product were mission-critical to your direct customer (preferred)
OR
d.) There was an immediate value to be had for your customer from introducing the product to the end user (monetization, good will, etc)
It seems that you have achieved only b (perhaps) and d in this equation, and then only to varying degrees. If you cannot pivot to solving the other variables then you should shut it down now.
2.) Selling to a customer that must then sell your product to its customer is at least an order of magnitude harder, and may be one of the hardest tricks for a new business to pull-off successfully.
Simply put, you don't have the branding to convert the end customer nor the control over that second sales process. Compounding this is that your product is not a priority for your direct customer and is not mission-critical to them in addressing their actual priorities. Thus, they will not engage nearly the focus required to address item 1 above in selling your product to its customers (i.e. end-users).
This last point can't be stressed enough. As entrepreneurs, our products are our focus and we tend to project that priority onto others.
The only way this model will work is if:
a.) The product is extraordinarily compelling/valuable to the end user in the same sense as would form the basis for building any viable business
AND
b.) The product is easy for your customer to sell to the end user in a frictionless manner (easy to communicate, requires no onboarding or support from your customer, etc.)
AND EITHER:
c.) Your product were mission-critical to your direct customer (preferred)
OR
d.) There was an immediate value to be had for your customer from introducing the product to the end user (monetization, good will, etc)
It seems that you have achieved only b (perhaps) and d in this equation, and then only to varying degrees. If you cannot pivot to solving the other variables then you should shut it down now.
I used to go to a lot of conferences, and some of the big conference organizers would try and push us to download an app - they were always really painful and didn't provide much value.
What does your app look like and what pain point is it trying to solve?
What does your app look like and what pain point is it trying to solve?
I'm a comp sci guy, my fiancee runs big (2,000 attendee) tech conferences [1]. Being her partner I have a reasonable amount of visibility into this world. Happy to chat with you.
[1] https://craft-conf.com/
[1] https://craft-conf.com/
Not sure if this fits your context, but could you get the conference to use your app for check in or something? Then they start out with it.
Edit: or find something else that benefits the visitors?
Edit: or find something else that benefits the visitors?
This is probably the key. Do you know why users aren't using the product? Have you asked them? It sounds to me like you have a market where one side has a problem, but the other side doesn't.
>It sounds to me like you have a market where one side has a problem, but the other side doesn't.
yes that is probably a succinct way to express it
yes that is probably a succinct way to express it
In that case move onto something else. Unless the side with the problem can force the other side to use your product then you don't have a viable business.
have you considered which side of the market is more important to focus on first
if you can get a lot of attendees to willingly use the app, the event organizers will follow. They might even knock down your door demanding to pay you $ for a chance to be your customer
if you get the event organizers to sign up, but the attendees don't use the app, then the event organizers will leave
so it would be best to focus on signing up attendees first? aren't they 100x more important then convincing the event organizers? just a thought.
if you can get a lot of attendees to willingly use the app, the event organizers will follow. They might even knock down your door demanding to pay you $ for a chance to be your customer
if you get the event organizers to sign up, but the attendees don't use the app, then the event organizers will leave
so it would be best to focus on signing up attendees first? aren't they 100x more important then convincing the event organizers? just a thought.
finding a real pain point that a customer is willing to preorder with real-money, is much much harder than coming up with a tech solution.
the former is harder because it is totally outside of your control, and the latter is way easier because it is almost entirely within your control.
have you thought of other tech solutions that can address the pain point? e.g. put ipads across the trade floor, with the app already installed, so you don't need to ask users to install anything. Or provide a $3 free coffee deal for every person that uses the app, as a marketing promotion? basically some other out-of-the-box way to solve that pain point that you spent so much effort to find
i would say, don't give up so easily because it sounds like you solved the hardest part (finding the pain point), and you are held up on the easier part (coming up with a technical solution). The tech part can always be adjusted on your end to meet the pain point somehow.
the former is harder because it is totally outside of your control, and the latter is way easier because it is almost entirely within your control.
have you thought of other tech solutions that can address the pain point? e.g. put ipads across the trade floor, with the app already installed, so you don't need to ask users to install anything. Or provide a $3 free coffee deal for every person that uses the app, as a marketing promotion? basically some other out-of-the-box way to solve that pain point that you spent so much effort to find
i would say, don't give up so easily because it sounds like you solved the hardest part (finding the pain point), and you are held up on the easier part (coming up with a technical solution). The tech part can always be adjusted on your end to meet the pain point somehow.
Sounds like you need to talk with these users.
https://news.ycombinator.com/item?id=15098643
Did you end up going to some conferences? There are serious problems with many conference apps. Even AWS Re:Invent's app had major problems this last year.
If you're wanting someone to do something (like download an app), you need to motivate them to do. This isn't about marketing. It's about delivering value.
Is your app currently only delivering value to the organizers and not really much for the users?
Did you end up going to some conferences? There are serious problems with many conference apps. Even AWS Re:Invent's app had major problems this last year.
If you're wanting someone to do something (like download an app), you need to motivate them to do. This isn't about marketing. It's about delivering value.
Is your app currently only delivering value to the organizers and not really much for the users?
>Did you end up going to some conferences?
yes i've been to ~1 conference per month since that post. would've gone to more but someone's gotta build the product right?
>Is your app currently only delivering value to the organizers and not really much for the users?
this is my stumbling point and it's a serious one because building a useful app for attendees is almost like building a fun app for consumers - you have to delight not just deliver value.
yes i've been to ~1 conference per month since that post. would've gone to more but someone's gotta build the product right?
>Is your app currently only delivering value to the organizers and not really much for the users?
this is my stumbling point and it's a serious one because building a useful app for attendees is almost like building a fun app for consumers - you have to delight not just deliver value.
Then do something about that! Don’t quit, go talk to the users and figure why they didn’t adopt. The answers are laying right in front of you but you seem deterred by doing the work. B2b is hard, try harder before quitting.
>The answers are laying right in front of you but you seem deterred by doing the work
...i've been the sole full-time founder for 9 months. i have worked every single day of those 9 months (doing everything - sales, customer success, investor relations, product). i am not deterred by work - i am deterred by the prospect of burning money chasing a delusion. the users didn't adopt for the same reason every users of every other advertising channel fail to engage: no one likes overt ads.
...i've been the sole full-time founder for 9 months. i have worked every single day of those 9 months (doing everything - sales, customer success, investor relations, product). i am not deterred by work - i am deterred by the prospect of burning money chasing a delusion. the users didn't adopt for the same reason every users of every other advertising channel fail to engage: no one likes overt ads.
9 months is nothing, especially in the B2B world. A lot of entrepreneurship is surviving the grind of the process itself.
If it makes you feel any better it took me 11 years to make any money with my startup.
Why did it take you 11 years? This doesn’t sound like a startup, more like a monetized hobby.
It is a long, long story [0].
0. https://www.tillett.info/2015/06/24/why-i-kept-my-startup-in...
0. https://www.tillett.info/2015/06/24/why-i-kept-my-startup-in...
Wow, I would say though even if you had moved to the US you could have revised history a bit after you became successful and still been local heroes in Australia. Startups do this kind of creative story-retelling all the time.
The nice thing about bootstrapping is you don't have to get involved in these creative story-retellings. I was a fool and I am fine admitting it (in my own defence I was a scientist who really didn't know much about business).
I should really write a follow up on this post as things have improved quite a lot here in Australia in regards funding. It is still difficult, but there is a startup ecosystem developing here.
I should really write a follow up on this post as things have improved quite a lot here in Australia in regards funding. It is still difficult, but there is a startup ecosystem developing here.
Bail. Your heart has left, you still have a very long way to go and you won't make it. This is not failure, this is being a grown up. I'm sorry.
Looks to me like you are 1/3 into the project. Why give up now?
Lesson 1) If a person didn't do almost exactly what you are doing (and most didn't) their advise is bullshit. And as you already see quite a few people even give you advise in both directions. People always think they know what they are talking about. In 95% they don't tho.
Lesson 2) Everything is 5-10 times harder than you think. If you already have 5 failing customer projects, that's awesome. Most ppl don't get there. Even some of them are paying. This is btw how getting product/market fit, or how did you think it happens? Magical numbers appearing in a nice little dashboard? Nope. Product/Market fit is more and more people slowly starting to pay you.
PS: High touch with first customers is nothing. Very normal. Not worth even mentioning.
Lesson 1) If a person didn't do almost exactly what you are doing (and most didn't) their advise is bullshit. And as you already see quite a few people even give you advise in both directions. People always think they know what they are talking about. In 95% they don't tho.
Lesson 2) Everything is 5-10 times harder than you think. If you already have 5 failing customer projects, that's awesome. Most ppl don't get there. Even some of them are paying. This is btw how getting product/market fit, or how did you think it happens? Magical numbers appearing in a nice little dashboard? Nope. Product/Market fit is more and more people slowly starting to pay you.
PS: High touch with first customers is nothing. Very normal. Not worth even mentioning.
Congrats on your willingness to feel your feelings of failure fully, and to ask for help. True success in life is our ability to be with our entire range of emotions and experience and not the attainment of any outcome.
I had thought I failed this past fall on a project to buy a tropical Island. I went deep into the emotions and confronted them.
From that space I got a strange flash of insight, shot an inspired email to the owner of said island with creative terms and an offer.
Last week we signed the contracts on the property and are moving ahead (http://Majagual.org)
We are turning the place into a sacred space to help visionaries find inspiration and healing and get clarity.
I’d be happy to gift you a “golden ticket” to the island to support your journey (now or in the future).
I had thought I failed this past fall on a project to buy a tropical Island. I went deep into the emotions and confronted them.
From that space I got a strange flash of insight, shot an inspired email to the owner of said island with creative terms and an offer.
Last week we signed the contracts on the property and are moving ahead (http://Majagual.org)
We are turning the place into a sacred space to help visionaries find inspiration and healing and get clarity.
I’d be happy to gift you a “golden ticket” to the island to support your journey (now or in the future).
> we've failed to do anything productive (... learn anything valuable, etc)
Whatever you decide to do going forward, this experience of running a struggling company is valuable. If you continue on, you've learned many things that don't work -- you can focus your efforts on other things. If you start a different business, you've been around this block before -- you'll spend less time figuring out the mundane parts of running a business and more on your revolutionary ideas. And, if you end up as a regular employee somewhere, you'll bring a unique perspective that new grads can't-- your understanding of business goals will help you make better technical decisions.
Whatever you decide to do going forward, this experience of running a struggling company is valuable. If you continue on, you've learned many things that don't work -- you can focus your efforts on other things. If you start a different business, you've been around this block before -- you'll spend less time figuring out the mundane parts of running a business and more on your revolutionary ideas. And, if you end up as a regular employee somewhere, you'll bring a unique perspective that new grads can't-- your understanding of business goals will help you make better technical decisions.
I'm sorry you feel that way but I think you're being too negative when you say "nothing productive" has been done or that pilots were a miserable failure.
Yes, things failed but at least you know more about the market, how to (not) build things, etc.
Consider pivoting into a similar area using your newly gained skills instead of shutting down. Also, if investors feel like the money should continue to be spent, that's a business decision and you shouldn't feel bad about it (unless they are super ignorant of business and invested for emotional reasons. If so, then educate them and it's their decision in the end).
Best of luck!
Yes, things failed but at least you know more about the market, how to (not) build things, etc.
Consider pivoting into a similar area using your newly gained skills instead of shutting down. Also, if investors feel like the money should continue to be spent, that's a business decision and you shouldn't feel bad about it (unless they are super ignorant of business and invested for emotional reasons. If so, then educate them and it's their decision in the end).
Best of luck!
I think you can really benefit from HN advice on your actual product. Want to link to your website/landing page here?
I've worked in the same market as you, I think, from the hints in your comments.
I've run or had a hand in running conferences and trade shows, as well as having built software and systems to keep the show on the road, from registration systems, management systems, surveying and apps. And I know the business side of startups too.
Perhaps you want to have a chat. HN has my email.
Without knowing anything, I'd speculate that if you aren't finding traction, then it's related to the structure of the conference/exhibition market which is a tough space to crack.
I've run or had a hand in running conferences and trade shows, as well as having built software and systems to keep the show on the road, from registration systems, management systems, surveying and apps. And I know the business side of startups too.
Perhaps you want to have a chat. HN has my email.
Without knowing anything, I'd speculate that if you aren't finding traction, then it's related to the structure of the conference/exhibition market which is a tough space to crack.
I've been involved in many (failed) startups. I'm actually going through the same situation you're going through right now. We have some pilots but the money isn't raining from the heavens yet.
I definitely agree with the suggestions here to take some time off. Sometimes, especially when you've been living and breathing this stuff for 9 months, you need some time away to rejuvenate. I did that a few years ago with a trip to Nicaragua when I felt like I couldn't ship the product I was working on. After a week of not thinking about it we went on to shipping the product and moving our production line to China. The startup still failed in the end (for other wonderful reasons) but that introspection time is 110% worth it.
One thing that resonated with me recently was to keep your network up. If you fail you fail but you'll have a group of people willing to help you out if and when it happens. If you continue and then thrive you'll still have a great support network when the stress hits hard.
A friend said it well on a recent episode of the $100 MBA Podcast. https://100mba.net/mba973/
Also, remember sometimes the failures are great insights into what is working and what isn't working. If you have had this many potential clients at this point nothing says that there aren't more out there that you can surprise, delight and serve.
Best of luck.
I definitely agree with the suggestions here to take some time off. Sometimes, especially when you've been living and breathing this stuff for 9 months, you need some time away to rejuvenate. I did that a few years ago with a trip to Nicaragua when I felt like I couldn't ship the product I was working on. After a week of not thinking about it we went on to shipping the product and moving our production line to China. The startup still failed in the end (for other wonderful reasons) but that introspection time is 110% worth it.
One thing that resonated with me recently was to keep your network up. If you fail you fail but you'll have a group of people willing to help you out if and when it happens. If you continue and then thrive you'll still have a great support network when the stress hits hard.
A friend said it well on a recent episode of the $100 MBA Podcast. https://100mba.net/mba973/
Also, remember sometimes the failures are great insights into what is working and what isn't working. If you have had this many potential clients at this point nothing says that there aren't more out there that you can surprise, delight and serve.
Best of luck.
Without knowing much about your business, I’ll just say B2B work can be a tough but more importantly long road. So 9 months may not be a long enough timeframe to judge failure.
My B2B startup focused on government clients, and we’re about to close a deal that took 2 years to close. Many times in that period I wanted to quit, but believed it was better to keep moving forward.
Only you know your business and market fit, and if you think it’s run it’s course then fold, otherwise fight a little longer and work with the success you’ve had so far.
My B2B startup focused on government clients, and we’re about to close a deal that took 2 years to close. Many times in that period I wanted to quit, but believed it was better to keep moving forward.
Only you know your business and market fit, and if you think it’s run it’s course then fold, otherwise fight a little longer and work with the success you’ve had so far.
rajacombinators advice is probably the best on here TBH.
Always remember this: nearly everyone is bullshitting you. What I mean by that is a very small number of people are actually worth listening to. Look at these comments on here. I would disregard 99.99% of the advice you receive. Ben Horowitz has a great story of this, when he finally sold Loudcloud and came to find out everyone he spoke to during the hard times was full of shit and ended up going bankrupt. Be very careful who you listen to.
Now - the truth is 9 months is not enough time, this fail fast approach is complete BS IMHO, you need 5-7 years to make something work. Unfortunately LEAN has completely screwed with what people think is required. Now when I say 5-7 years, I don't mean 5-7 years on the same idea. I mean 5-7 years for the LTD/LLC/Inc to get to cash flow positive. So this could be pivot numero 50 by the point you get there. Fundamentally you have to rationalise your product the following way, are you really ADDING value (people are receiving more than they pay for the product/service) and do your potential customers actually give a shit. Things are much easier when customers really really love your product, I know it's obvious. But it took me years to stop listening to my own BS. As founders we rarely see the 100% truth due to the failing of our biases.
Giving back capital to investors is the last thing you should ever be thinking of doing. I would cut every single cost down to near zero (in the biz) and make sure you're own personal expenses are extremely low ($1k-1.5k/mo). That way you have time to make this work.
NEVER EVER GIVE UP.
Always remember this: nearly everyone is bullshitting you. What I mean by that is a very small number of people are actually worth listening to. Look at these comments on here. I would disregard 99.99% of the advice you receive. Ben Horowitz has a great story of this, when he finally sold Loudcloud and came to find out everyone he spoke to during the hard times was full of shit and ended up going bankrupt. Be very careful who you listen to.
Now - the truth is 9 months is not enough time, this fail fast approach is complete BS IMHO, you need 5-7 years to make something work. Unfortunately LEAN has completely screwed with what people think is required. Now when I say 5-7 years, I don't mean 5-7 years on the same idea. I mean 5-7 years for the LTD/LLC/Inc to get to cash flow positive. So this could be pivot numero 50 by the point you get there. Fundamentally you have to rationalise your product the following way, are you really ADDING value (people are receiving more than they pay for the product/service) and do your potential customers actually give a shit. Things are much easier when customers really really love your product, I know it's obvious. But it took me years to stop listening to my own BS. As founders we rarely see the 100% truth due to the failing of our biases.
Giving back capital to investors is the last thing you should ever be thinking of doing. I would cut every single cost down to near zero (in the biz) and make sure you're own personal expenses are extremely low ($1k-1.5k/mo). That way you have time to make this work.
NEVER EVER GIVE UP.
Perhaps you're not enjoying the work, or you're burned out because you're working too hard. Take a step back and think about WHY you want to quit NOW.
Keep asking yourself why, why, why, and find what is the real root cause. Do you want to do something else? Are the failures you've had demoralizing? Do you think it's impossible to fix the product? Is your market smaller than initially expected?
Keep asking yourself why, why, why, and find what is the real root cause. Do you want to do something else? Are the failures you've had demoralizing? Do you think it's impossible to fix the product? Is your market smaller than initially expected?
Contact me for marketing. It doesn't matter if the product is the best thing since sliced bread, if it's not marketed it will fail.
> Contact me for marketing
I'm not OP, but how?
I'm not OP, but how?
This is slightly off topic, but I have noticed that about half the time on HC when someone says contact me that they have no contact details in their profile.
I suspect that's because HN doesn't make it clear that your email isn't publicly visible on your profile.
I can't think of a single website where your email is publicly visible on your profile by default.
I suspect you are right. If it were any other site I would send a suggestion off to YC, but there is no point as nothing about HC will change.
of course but if the product is terrible spectacular marketing only gets you so far (which honestly exactly where i think we are - after lots of high touch sales we got some pilots despite product deficiencies)
how are you throwing in the towel with 50% of funds left and encouragement from your early investors?
get back in there and find a way to make it work! come back in three years when your broke, your early investors hate you, and you’ve had at least one divorce.
just kidding. its hard to be a startup founder. it takes a lot of time and energy. some good suggestions here, take some time, regroup, come back refreshed. Keep your burn low and talk to your customers about why they left and ask the people who never signed on why they didn’t.
perhaps equally important, if you insist that you’ve already failed and you don’t have the motivation to push forward, please stop wasting other peoples money and give it back. or at least hire someone who will try. do not phone it in. one warning though, if you tap out now, you may very well ruin your reputation and another shot at a funded startup. the early stage investors are prepared to lose their money on a stallion, but not on a deadbeat. either way they will remember you.
get back in there and find a way to make it work! come back in three years when your broke, your early investors hate you, and you’ve had at least one divorce.
just kidding. its hard to be a startup founder. it takes a lot of time and energy. some good suggestions here, take some time, regroup, come back refreshed. Keep your burn low and talk to your customers about why they left and ask the people who never signed on why they didn’t.
perhaps equally important, if you insist that you’ve already failed and you don’t have the motivation to push forward, please stop wasting other peoples money and give it back. or at least hire someone who will try. do not phone it in. one warning though, if you tap out now, you may very well ruin your reputation and another shot at a funded startup. the early stage investors are prepared to lose their money on a stallion, but not on a deadbeat. either way they will remember you.
You and your team should watch this 3 times right now: https://youtu.be/_6pl5GG8RQ4
It’s about finding product market fit after a few different products. It talks about how their new successful product (150 staff) is a small feature from one of their other products and how they scaled that!
Do it!
It’s about finding product market fit after a few different products. It talks about how their new successful product (150 staff) is a small feature from one of their other products and how they scaled that!
Do it!
You can do better than this.
The OP mentioned 7 hours ago that they had already watched this video, last week.
https://news.ycombinator.com/item?id=16949765
The OP mentioned 7 hours ago that they had already watched this video, last week.
https://news.ycombinator.com/item?id=16949765
I hope you find the right answer.
Selfishly I want a start up to develop cheaper goods for offices, like desk lamps... why are those so expensive?
Selfishly I want a start up to develop cheaper goods for offices, like desk lamps... why are those so expensive?
I have no experience with what I am recommending, so please take it with some large grains of salt.
I suggest trying to pivot for a specialization, just a niche of B2B tradeshows. I think looking at the most expensive B2B AdWords[0][1] should be a quick and easy way to help you in that regard. From my brief research it seems like if you specialized in 'virtual data rooms' you might be able to make some quick $. It doesn't look like there are any tradeshows in that domain, and it has a very high CPC.
[0]: https://www.wordstream.com/blog/ws/2017/06/27/most-expensive...
[1]: http://grepwords.com/1000000-top-high-paying-cpc-adwords-ads...
I suggest trying to pivot for a specialization, just a niche of B2B tradeshows. I think looking at the most expensive B2B AdWords[0][1] should be a quick and easy way to help you in that regard. From my brief research it seems like if you specialized in 'virtual data rooms' you might be able to make some quick $. It doesn't look like there are any tradeshows in that domain, and it has a very high CPC.
[0]: https://www.wordstream.com/blog/ws/2017/06/27/most-expensive...
[1]: http://grepwords.com/1000000-top-high-paying-cpc-adwords-ads...
Unless you perish in a disaster, there is no such thing as business failure. Only mistakes and fuckups (results of which can only 'change' your business into some other shape or form).
So do the obvious to sort things out as best you can; to fulfill your obligations and responsibilities without giving up; be honest with your personnel, customers, and investors/partners - make arrangements to repay who is owed all the while being open about your complete situation.
At least this way there is some hope of bringing a bad situation to neutral ground. You can try and if you give it your best, you can go to sleep at night feeling at ease cause that is the only thing anyone can ever expect of you - that you are honest and doing your best.
(of course, your reputation and ability to do business in this way again in the future may be impacted but such is reality; mistakes and fuckups have consequences of which you have to accept too)
So do the obvious to sort things out as best you can; to fulfill your obligations and responsibilities without giving up; be honest with your personnel, customers, and investors/partners - make arrangements to repay who is owed all the while being open about your complete situation.
At least this way there is some hope of bringing a bad situation to neutral ground. You can try and if you give it your best, you can go to sleep at night feeling at ease cause that is the only thing anyone can ever expect of you - that you are honest and doing your best.
(of course, your reputation and ability to do business in this way again in the future may be impacted but such is reality; mistakes and fuckups have consequences of which you have to accept too)
I'd say that sometimes the raw economics works against you and it can be very difficult to change that. As an example take micro-payments, I'm sure hundreds of startups have tried to make it work but the economics don't stack up in a way that works. The problem you are working to solve may be unsolved for a reason. Your investors may be thinking very naively; on the face of it some problems seem easy to solve but actually are almost impossible.
On top of that it sounds like you're pretty smart and business focused but you aren't hugely passionate about the problem you're solving.
I would probably advise you to go away and find a different problem to solve; one that you're more passionate about and one where the economic model stacks up. If you've got a good team of people then you can probably leverage that to become successful in a new space.
On top of that it sounds like you're pretty smart and business focused but you aren't hugely passionate about the problem you're solving.
I would probably advise you to go away and find a different problem to solve; one that you're more passionate about and one where the economic model stacks up. If you've got a good team of people then you can probably leverage that to become successful in a new space.
So my take on it is that your only job as a startup if you don't already have product/market fit is to find it. And then, if you have it, you focus on growing.
Then, quite simply, your options are a) Find product/market or b) Quit.
To decide between a) or b), try to think how close you are to getting it. Do you have a few users that love your product but the pricing is wrong? Did you find something interesting in the market that you think you can compete on but didn't execute well-enough?
I would say if you lost your passion and don't think you've got something interesting enough to get a few users to love your product, then it's time to quit and (maybe) start over on a fresh idea. If on the other side you're still passionate about the space and think you're onto something, then keep trying.
Then, quite simply, your options are a) Find product/market or b) Quit.
To decide between a) or b), try to think how close you are to getting it. Do you have a few users that love your product but the pricing is wrong? Did you find something interesting in the market that you think you can compete on but didn't execute well-enough?
I would say if you lost your passion and don't think you've got something interesting enough to get a few users to love your product, then it's time to quit and (maybe) start over on a fresh idea. If on the other side you're still passionate about the space and think you're onto something, then keep trying.
I've just read nearly all posts here and I think that HN has done you proud. There is loads of good advice here and very little noise. You have enough loot left for three salaries for one year at $30,000 and some loose change.
You might be able to do something else eg: basic "IT" if you have people willing to give it a go an a few technicians on the staff. If money comes in then who cares where it comes from. Basic IT services are very easy to sell. Yes it is boring but you'd be surprised how it leads on. My little company has some customers that you will have heard of, and you are not from around here. We are boring and I wouldn't have it any other way 8)
You might be able to do something else eg: basic "IT" if you have people willing to give it a go an a few technicians on the staff. If money comes in then who cares where it comes from. Basic IT services are very easy to sell. Yes it is boring but you'd be surprised how it leads on. My little company has some customers that you will have heard of, and you are not from around here. We are boring and I wouldn't have it any other way 8)
How did you find clients with a boring company? I love "boring" stuff btw, I feel like I helped more people doing boring stuff (tech support, simple automation) than the "hip" stuff
What a friend did years ago was put up flyers in local office buildings.
So you know what the problem is - the solution is to find product market fit. Take a couple days off, relax, and then go back to work hungry to solve this problem.
Get in and talk with the Pilot companies - be straight up and honest, ask them if it’s really solving a problem for them or if it’s just a nice to have. Ask what their true pains are.
Monitor your run rates and have contingency plans for dealing with what happens if funds get low.
If you’re worried, talk to your cofounders and make sure you’re communicating properly. Express your concerns.
If you truly want to quit, then you can do that but it will have consequences as well.
Startups can be hard, but the rules are simple. Find a problem and solve it.
Get in and talk with the Pilot companies - be straight up and honest, ask them if it’s really solving a problem for them or if it’s just a nice to have. Ask what their true pains are.
Monitor your run rates and have contingency plans for dealing with what happens if funds get low.
If you’re worried, talk to your cofounders and make sure you’re communicating properly. Express your concerns.
If you truly want to quit, then you can do that but it will have consequences as well.
Startups can be hard, but the rules are simple. Find a problem and solve it.
I have worked in a startup which failed, pivoted and now is a billion dollar company.
My main rule of thumb is that if your current problem statement is failing then become bigger, in the sense take up a problem that has even more market demand than the current problem and then add features to your existing solution to solve for the bigger problem. The chances of you landing a customer increases this way.
You have targeted B2B sales-shows think of targeting B2C+B2B shows now. Can your product solve for handling sales shows where consumers go?
Expanding is the key, usually companies contract further and fail, when you expand the chance of getting a customer increases.
My main rule of thumb is that if your current problem statement is failing then become bigger, in the sense take up a problem that has even more market demand than the current problem and then add features to your existing solution to solve for the bigger problem. The chances of you landing a customer increases this way.
You have targeted B2B sales-shows think of targeting B2C+B2B shows now. Can your product solve for handling sales shows where consumers go?
Expanding is the key, usually companies contract further and fail, when you expand the chance of getting a customer increases.
Highlevel features I can think of
From a seller perspective
- contact management - emailing and reminders - text message nudges for customers - showing analytics of previous events - managing previous customers - feedback from previous customers
From a seller perspective
- contact management - emailing and reminders - text message nudges for customers - showing analytics of previous events - managing previous customers - feedback from previous customers
these tools already exist (and number probably in the hundreds)
You must analyse why you're failing. Is your product not good enough? Is your strategy lacking somewhat? Is the concept itself flawed?
If it's the last one, then it may be time to call it a day. Explain to your investors that you were unable to validate the concept, so it's best to cut their losses. It's a tough conversation, but the ethical thing to do.
If it's the other things, I'd give it a bit more time. I've run a few successful start ups in the past (as well as now), and traction takes a while and develops in obscure ways.
If you need someone to bounce ideas off, drop me an email (in my profile). All the best!
If it's the last one, then it may be time to call it a day. Explain to your investors that you were unable to validate the concept, so it's best to cut their losses. It's a tough conversation, but the ethical thing to do.
If it's the other things, I'd give it a bit more time. I've run a few successful start ups in the past (as well as now), and traction takes a while and develops in obscure ways.
If you need someone to bounce ideas off, drop me an email (in my profile). All the best!
It sounds like you are in the dip. See Seth Godin's book on this subject.
https://www.amazon.ca/dip-Seth-Godin/dp/1591841666
I was in a very similar situation for one of my startups, a Shopify clone. We grew it to 50+ paying customers but stalled.
I ended up giving up all my shares to the other founders and taking a 2 year trip to Asia. The company managed to survive and was sold.
I don't regret it. Move on, if the team is good, you will reconnect and build something even better eventually.
https://www.amazon.ca/dip-Seth-Godin/dp/1591841666
I was in a very similar situation for one of my startups, a Shopify clone. We grew it to 50+ paying customers but stalled.
I ended up giving up all my shares to the other founders and taking a 2 year trip to Asia. The company managed to survive and was sold.
I don't regret it. Move on, if the team is good, you will reconnect and build something even better eventually.
I dont mean to sound insensitive but why did you raise money without "product market fit?" I hate the phrase but accept its use. 220k for an idea without a sales or go to market strategy strikes me as terribly tragic. And based on the details you've shared, most of the burn was on people costs. So you had an idea, raised money, hired people...and NONE of them were full time sales?
Return the money. Take a vacation. Get up off the mat in due time. But NEVER ever start paying people (or yourself, most important) without a clear path to revenue.
Return the money. Take a vacation. Get up off the mat in due time. But NEVER ever start paying people (or yourself, most important) without a clear path to revenue.
I don't know where you got the idea that we didn't have sales - we did.
So what's the problem? Not enough sales?
Events and tradeshows are in a category of their own, but anything that goes wrong in front of an audience comes with a large emotional burden. In events, there is never such a thing as perfect, but learning to execute well means less surprises. If you're burnt by recent catastrophes, know that there is also an amazing feeling that comes when things do go right. If you like/trust the people you are doing it with then stick with it until you can get a win, then decide if you want to keep at it.
You're saying your fff investors are giving mixed signals and you're not sure what to make of them.
We're not your fff investors so we can't unmix those signals for you; our guesses are worse than yours.
So just do what you'll always have to do when you need to get alignment/resolve conflicting signals: get everyone into a room and don't let the meeting end until everyone agrees on the right way forward.
We're not your fff investors so we can't unmix those signals for you; our guesses are worse than yours.
So just do what you'll always have to do when you need to get alignment/resolve conflicting signals: get everyone into a room and don't let the meeting end until everyone agrees on the right way forward.
If the investors were fully aware this is at risk and they backed you because of the team and not the product/market then I'd use the remaining cash to build something else where you are the first customer and start over. Reduce the team to just the co-founders, 100k is still a lot of money for a team of two or three and you can probably afford one or two more experiments.
Hey – I know you're being vague since it's a public forum, however my email is in my profile if you want someone to talk to.
I personally went through this at the end of the year. I wrote about it and hope that it's helpful: https://medium.com/startup-grind/startup-mortality-what-end-...
Hey! I found your responses and the discussion in general around this fascinating. I'm currently running an event tech start-up and would love to talk to you more about it.
It looks like you took an approach we wanted to take but thought it'd be harder to monetize (as you found out).
Want to e-mail me and lets chat? (info in profile)
It looks like you took an approach we wanted to take but thought it'd be harder to monetize (as you found out).
Want to e-mail me and lets chat? (info in profile)
Wow, if you're able to "return funds" and start over, why not? I suspect that's not the usual situation.
Returning funds means you might be able to tap the same pool again. Continuing on risks that rare situation.
Sounds like you could pull back, re-assess, and take a second run. How many get that chance?
Returning funds means you might be able to tap the same pool again. Continuing on risks that rare situation.
Sounds like you could pull back, re-assess, and take a second run. How many get that chance?
9 months is short and is ok to continue even if you are making very little, however from what I read I would be more concerned about you having or not a good product, since the pilots went bad. IMHO the thing to do is to analyze why the pilots failed, and understand if that can change.
1. I think giving up at this stage is the the easiest thing to do - and I think it common due to the uncertainty about the future
2. Check that you can imagine yourself spending next few years doing what you are doing, just even more harder
3. If so, double down, as suggested above ask why, why and why. If needed, pivot.
2. Check that you can imagine yourself spending next few years doing what you are doing, just even more harder
3. If so, double down, as suggested above ask why, why and why. If needed, pivot.
My two cents: building a business is hard and 9 months is not enough time... If you believe in the general concept and think it could succeed, then you need to leverage The experience you already have and continue trying until the funds run out or you reach the end of the runway.
I'd shut it down. It sounds like you do not believe it is working. And tech B2B tradeshows is not a very good business anyway. Founders get to work on literally ==any== problem or business they want to. There's little reason to work on a bad product.
Question: did you start with a problem to solve? Or are you a solution in search of a problem?
I worked for a startup that raised money 4 times, over 50 million, before they found product market fit. So while it’s very important, it’s clearly not impossible to keep going if you believe you can find product market fit eventually.
Slightly random suggestion here but anyway - why not shut things down, give most of the money back then go travel (SE Asia digital nomad stuff) and keep hacking on the app to see if you can come up with some better version?
If you looking for ideas, shoot me an email I have nice cultivated list of ideas I think worth looking into, however I'm working on too many at the moment but have no problems sharing (but not in public forum)
Lots of good advice. One more... Since you are now the sole remaining founder, take care of your stamina and mental health. If you still have the majority of the equity, you can give some away for top talent.
Pivot to a new idea or try to shop your team around for a small acquisition so you can pay your investors back. Even if you guys don't have a valuable product per say, you might have a valuable team.
This is why i am wondering: why are the very early stage investors giving money in bulk vs feeding the startup some amount every week as long as they all agree it makes sense to keep going?
Investment in a company is traded for power over that company (ownership of shares). It's not so much giving money in bulk, as it is paying for your share of control and reward in the company. If a majority of the controlling ownership of a company decide to liquidate the company, then they can do that, and get back what remains of their investment.
There is not usually any right to get your money back as a minority shareholder, as this retraction of your commitment would be damaging to the interests of the other shareholders.
There is not usually any right to get your money back as a minority shareholder, as this retraction of your commitment would be damaging to the interests of the other shareholders.
Because the founder would be spending all of their time reselling the investors every week. I don’t want an entrepreneur spending their weekends looking for jobs on LinkedIn because they had a bad week. You need patient capital to build and iterate to PMF.
That's interesting, so you see convincing someone paying say $10,000 a week as long as he sees progress as good, slowly exchanging it for stock at a set valuation, as harder than shelling out $2M out of the pocket in one bulk amount?
I have experience of the former (well, it was more like $5K in my case) and it wasn't hard at all, i struggle to imagine myself raising $1M at once. $5K a week sounds like too little, but as far as hiring coders go, as i am in East Europe, it's like $10K in West Europe or $20K in the Valley, not insignificant.
Maybe that's just shyness/psychological barrier? I struggle to imagine myself saying someone 'give me a million bucks and we'll build this cool thing and get rich', but asking for 'decent salaries for these good guys and myself, so we don't have to go to Upwork, plus covering our AWS costs' is whole lot easier for me, and it works.
I have experience of the former (well, it was more like $5K in my case) and it wasn't hard at all, i struggle to imagine myself raising $1M at once. $5K a week sounds like too little, but as far as hiring coders go, as i am in East Europe, it's like $10K in West Europe or $20K in the Valley, not insignificant.
Maybe that's just shyness/psychological barrier? I struggle to imagine myself saying someone 'give me a million bucks and we'll build this cool thing and get rich', but asking for 'decent salaries for these good guys and myself, so we don't have to go to Upwork, plus covering our AWS costs' is whole lot easier for me, and it works.
Yes, terrible idea. I wouldn’t back a startup under those conditions. And what if there are multiple investors? Now you have to be schmoozing them up all the time. As an investor you make a bet on a team to execute. If you’re not comfortable making that kind of bet then maybe you shouldnt be backing a team that you only trust with one month of runway. I can tell you, that you’d be the last investor that an entrepreneur would go to for funding — which would mean that you get the worst deals.
I feel your pain...but a little less so, since I only spent my own money. My advice is simple: if you believe 100% in what you’re doing, keep doing it! If not, quit ASAP.
Find something you actually believe in working on, or go make money (regular job)
Those are the two options everyone always has. If you're not doing one or the other, I don't know what the hell it is that you're doing at all, and sounds like neither do you.
A more meta point - you need to know what your life is about, instead of going by what's 'responsible', or whatever else. You need to know what it is you're doing with your life, then you won't be in emotional turmoil, because there won't be success or failure, just steps along the path.
Those are the two options everyone always has. If you're not doing one or the other, I don't know what the hell it is that you're doing at all, and sounds like neither do you.
A more meta point - you need to know what your life is about, instead of going by what's 'responsible', or whatever else. You need to know what it is you're doing with your life, then you won't be in emotional turmoil, because there won't be success or failure, just steps along the path.
I think it would be useful to give details. If we knew what the product was and what didn't work we might be able to help.
What do people use your company’s product for?
If you don’t want to share on this thread, maybe wait a bit & post as a “Show HN”...
If you don’t want to share on this thread, maybe wait a bit & post as a “Show HN”...
Failing something is learning. A lot. Take that lesson and turn it around. You still have a runway to take off from.
You can also spend all the money and give these investors a good lesson - you will be doing them a favor.
it's not only your decision. straight honest talk with your investors, listen to what they want, what risk they want to take and decide together ... but listen you should be able to start a company on $50 ... if not your wasting people's money
Are you selling 24/7? To actual potential customers. Forget selling to investors.
Why would you take $220K from friends and family without being profitable? It's one thing to want to scale your business, it's another to just try an idea that you're not even sure makes money.
Follow your instincts.
If you're interested in a full time salaried CTO position at a recently funded VR startup (cofounder level entry, but salaried/optional equity), message me at [email protected]
If you're interested in a full time salaried CTO position at a recently funded VR startup (cofounder level entry, but salaried/optional equity), message me at [email protected]
if you have still 100K and if you really believe in your product (or at least if you think market needs something similar to what you are offering), take a risk and outsource technical part of product, do sales by yourself, focus on sales, marketing.
Contact me if you wish to find remote outsource team for ~6k/month, this will give you another 1 year of development time. email: {myusername} at google's email service
Contact me if you wish to find remote outsource team for ~6k/month, this will give you another 1 year of development time. email: {myusername} at google's email service
1. Do no stop
2. Do not return the money, that's not how investing in startups work
3. Apply to Y Combinator
4. Keep on going, think about "pivoting"
5. Read the book "Founders at Work"
2. Do not return the money, that's not how investing in startups work
3. Apply to Y Combinator
4. Keep on going, think about "pivoting"
5. Read the book "Founders at Work"
Build another one. :)
[deleted]
Tell your investors/angels asap. Sell what's left and return money to them first. Reuse/recycle what you have. Don't just throw the code or the team away. Move on. Remember that failure is the default setting for learning. Learn and try again with something else. Never give up!
Hopefully you'll find what you are looking for. It's one of the hardest stages to go through
Tough mate, all the best!
grosjona(4)
re pilots: we got 5 pilots (some paying some not) by basically being persistent and doing really really high touch sales. two of them ran this week and they were miserable failures (for every reason from poor marketing/education to last minute catastrophic product failures). absolutely all of the metrics skew heavily towards 0.
i realize i'm being vague and maybe there's not enough detail in the post to give substantive advice but regardless any would be appreciated.