5 Startup Lessons from our First Year in Business
2014 was our first year in business at Get Invited. We moved into our office, hired a team, launched a product and started acquiring our first customers.
It was an incredible year, with lots of ups and plenty of downs but I've learnt an incredible amount in a short space of time through first hand experience. This article serves as a little self-reflection; revealing the mistakes I've made along the way, the lessons learned and how this informs our path moving forward.
I'm sharing these insights in the hope that it will help you avoid making these same mistakes and shortcut your path to success.
1. Find Focus, Fast
When starting out, it will take some time to figure out which activities you should be engaging with to run and grow your business. There will be lots to choose from, many of which are distractions, so it's important be selective, otherwise you may waste a lot of time doing things that won't drive your business forward. I've wasted time in three areas that provided little value to business growth.
1. Entering Awards and Competitions
Throughout 2014, we applied for lots of awards in an attempt to gain exposure. This required time to fill in application forms and often involved attending dinners and award ceremonies, some in overnight locations which cost money too. Despite being shortlisted for several awards, we only won one (DANI Award for The Best Mobile Application, which was actually pretty awesome) but the rest were largely a waste of time. We didn't gain much exposure, new customers or any real value from them.
2. Focusing On the Local Market in Northern Ireland
We initially spent far too much time performing product validation and customer acquisition exercises in Northern Ireland. With all due respect to my wonderful wee home country, it's not the best place to do either of these exercises and gain proper insights. I've found that many people don't fully grasp innovative technologies here and are also incredibly slow to adopt them.
After my first trip to the US, I realised that many of the tools we were building, that had been previously discredited or misunderstood at home, really excited customers in this market. I also learned that we could acquire customers much faster in the US and people would instantly tell us if they were interested or not, saving us a lot of time.
At home, it typically takes weeks (or months) to set up a meeting and then countless additional meetings and/or online correspondence in order to close a sale. In the US, I was able to secure meetings in less than 48 hours (even with huge companies like Square and Stripe) and deals typically close much quicker. Things move extremely fast and in hindsight, we should have visited the US much sooner to perform these exercises.
3. Events & Networking
There is an endless list conferences and networking events (fortunately for us at Get Invited!) but these can become a huge distraction. I've attended lots of events packed with other startups who are ruthlessly trying to promote their own business or searching for a job. As an aside; this is not a good networking strategy and you should be focused on what value you can provide to a network as opposed to ruthless self-gain.
Try to be strategic with networking and choose events wisely. I also found that one-to-one networking over coffee is much more beneficial, you can target the people you really want to meet and work towards getting a meeting. You should also focus on getting to know a few super-connectors with huge networks who can connect you with anyone you need, especially when visiting other countries.
So, what should you spend your time doing?
Ultimately you should be focusing as much of your time on acquiring new customers and building/improving your product to provide as much value to your existing customers as possible. Set up a pipeline of potential customers and constantly reach out to them and build relationships via whichever channels work for you (email, social media, face-to-face). Building relationships takes time and effort. Acquiring customers is rarely as simple as blasting out emails and will involve follow up calls, Skype demos and documentation.
This is the ideal scenario, but for a new, small startup there will be a lot of distractions. I completely underestimated the sheer diversity of tasks required to run a business. In addition to selling and building a product you'll have to: manage cashflow and accounts; meet with investors and raise capital; fill in grant applications and claim forms; manage your team; deal with unexpected problems and issues; provide help and support to customers; travel; deal with hundreds of emails on a daily basis; manage social media; attend meetings, pitches, give talks etc... and managing, measuring and tracking all these tasks is another huge undertaking in itself.
Time management is key, automate as many processes as possible and batch tasks into time blocks. It's so easy to jump between the many tasks on offer at any one time but this is counter productive. If you can focus for 1-2 hours on a single task you will get more done. This might sound easy but finding 2 hours in a startup to focus can be incredibly rare with the constant flow of phone calls, emails and meetings.
2. Build a Customer Acquisition Machine
From day one at Get Invited, we were completely focused on building more and more product features, and somewhat neglected to build a scalable business model. This was my biggest mistake. Right now, we're testing a lot of assumptions through various experiments to deliver solid metrics and to set up the business for scaling. Much of our growth in 2014 was down to unstructured customer acquisition hacking (which is fine initially). We didn't have the right processes in place and we weren't tracking the right metrics.
The lesson? Figure out how to build a scalable funnel and prove that you can put £X into one side and get £X:3 out the other side. When you have this, you have a scalable business model that will enable you to raise a lot of money (provided there is a large enough market)
3. Surround Yourself with Great People
I've had a slide with this title in virtually every talk I gave throughout 2014. I believe it is the fundamental ingredient to building a successful business, especially for a first time entrepreneur. When starting out, we didn't have any answers and we had no idea what we were doing. Everything was new and extremely daunting but we were extremely fortunate to have good, experienced people around us to help.
As the University of Ulster invested in Get Invited, we were incredibly lucky to have Tim Brundle on our board and he has gone above and beyond to help us through mentoring, advice and answering hundreds of my questions.
We also took part in the Springboard Programme at the Northern Ireland Science Park, where we were assigned a mentor, Darren Craig, who has sacrificed a lot of his own time to mentor us and help us, without ever asking for anything in return. I really cannot stress the value of having people like this involved in your business.
There is a lot of advice available, but you should aim to find people who have been there and done it themselves. You don't need to pay expensive consultants; find people who have made it and who are now passionate about giving back and who believe in you and your product. You simply cannot buy the experience and advice these people will bring.
Team is Everything
I know several single founders and I have the upmost respect for them, I certainly couldn't walk this path on my own and the success we enjoyed in 2014 was wholly down to having a great team of talented and passionate people who consistently deliver their best efforts.
Get Some Entrepreneur Friends
The entrepreneurial journey can be tough at times and it can also be very lonely and extremely stresful. You open yourself up to a whole new world of problems; problems that most people won't understand or be able to help you with. You also need to be selective about who you share your problems with to avoid creating problems for other people. I've had many sleepless nights worrying about things I haven't shared with anyone.
Find some other entrepreneurs you can talk to, share stories with and get advice from those who have been through the same problems as you.
4. Beware of Feature Ideas
Building a product is incredibly exciting but it's easy to get carried away when it's your startup and you and your team are full of ideas.
We spent a lot of time last year building features and coming up with ideas for new features, which is justified in the early stages of product development, however in hindsight we did spend a lot of time building features that we hadn't properly validated. We'd come up with an exciting new idea and then start building it with the view that we'd ship it and see if people used it, which is very time consuming.
Much of this was fuelled by a constant need to differentiate ourselves in the market and to potential investors. Customers are also full of ideas for features and it can be easy to try and please everyone. A good rule of thumb is; if lots of customers are continually asking for a certain feature, then you need to build it. For innovative new features that you've dreamed up or a single customer is requesting then you need to properly validate this before you spend any time building it.
Our process for validation now is typically that Stuart, our lead designer will produce an interface mockup and I'll present it in a pitch or customer meeting to gauge their interest. If customers simply must have it, then we'll start the process of building it. This has saved us a lot of development time in recent months.
The focus in early 2015 for us now is on refining, optimising and simplifying our existing feature set and optimising our customer acquisition funnel to maximise activation and retention before we move on to tackling any new features. As we have learnt; customers don't leave your product because you haven't implemented some cutting edge, new feature; they leave because they're frustrated by a lack of core features or existing features that don't work as well as they should.
5. Embrace Your Mistakes
Finally, it's ok to screw things up. Building a company is an incredible learning experience, especially when doing it for the first time. You're going to make mistakes, lots of them – but it's just part of the learning process and not a reason to condemn yourself. In 2014, I made a whole string of mistakes. I've managed situations badly; upset people; frustrated people; lost sales and said lots of stupid things – mostly due to inexperience but these mistakes have provided me with hard, first-hand experience and you can't get that from reading a blog or a book. It's the only way to learn.
Sometimes, the only way to figure out the right way to do something is to screw it up first. Building a startup is not about having all the answers, or even most of the answers – it's about figuring out the answers along the journey.