Presentation is loading. Please wait.

Presentation is loading. Please wait.

7 Lessons I learned from the Failure of My First Start Up Michal Bohanes.

Similar presentations


Presentation on theme: "7 Lessons I learned from the Failure of My First Start Up Michal Bohanes."— Presentation transcript:

1 7 Lessons I learned from the Failure of My First Start Up Michal Bohanes

2 Dinnr ® was an ad-hoc, same day ingredient delivery service. Select a recipe on our website, and we deliver everything you need to cook that recipe at home Background

3 This is an 18 months and 12 days entrepreneurship based on an idea that had inspired me for a long time. After having spent tens of thousands of pounds of my personal money and working obsessively, I felt that I had given at all and that it was a time to move on. Background

4 Even after realizing that things are going crazy, people stick to the guns simply because they set out to make things happen and due to obligations to investors.

5 Another reason being believing myths like “A winner never quits” “Tales of entrepreneur legends who lost all their money, got abandoned by their family members and friends, were so hungry that they ate cardboards, only to triumph in the end and built a global empire.” Myths

6 Are you solving an actual problem

7 The number one lesson I will never forget and the absolute key to understanding Dinnr’s failure is – that “we were not solving anyone’s problem” The biggest mistake we committed in the initial market survey was to present the excellent idea (in our own eyes) to the people instead of discovering their problem. So everyone praised the idea with an additional note “ Launch it and we will buy it”. Market Research

8 People give positive feedback on a new business idea mainly due to two reasons. People want to make you, the founder, happy People are too optimistic about their future behavior. Market Research

9 We realized later there never was a need for this service in the segment we picked. Market Research

10 When someone is praising your idea and says” I have not really thought about that but what you're saying makes total sense and it’s so true”, this is a red flag, because if they haven't really thought about it, that means it is not a high priority for them. Market Research

11 You must never ever pitch the idea to the customers, instead the goal should be digging about the problem.. Market Research

12 Never ask about their future aspirations, rather ask about the past behavior about such products.. Market Research

13 So when the business was closed down, many people looked sad and lamented “ It was SUCH a good Idea” but we don’t have time to cook at home. Market Research

14 They got the lesson for free, and I had to pay the price. My company Dinnr was a classic case of a Solution looking for the Problem Market Research

15 So the First Lesson I learned was “ Not every good idea is a good business. I conducted superficial market research which was not aimed to dig out the Problem.”

16 This is a topic superbly discussed Rob Fitzpatrick’s great book “ The Mom Test” The Author recommends to ask for commitment straightaway

17 The story goes on. Let’s move to the next lesson

18 An Austrian Meme says “To start a line of work, you have to dedicate a lot of time to studying it and preparing for it. And then, one day in the far future, you’ll be allowed to actually DO it.” The Opportunity

19 This means “You can’t do anything too complex because you don’t have the expertise.” And I believed it The Opportunity

20 I thought it’s a good business to run as my first startup. It’s relatively simple, I understand the value proposition, I understand the customer. I will get very valuable experience at a low risk which I will then be able to use for future, bigger, projects. And this was a mistake The Opportunity

21 Entrepreneurship is contrast to this saying. Actually it is the power to apply your knowledge, actively doing something and not just absorbing. The Key is stepping up to the opportunity The Opportunity

22 Expertise in a domain helps of course and gives someone more credibility with investors. But examples are abound where entrepreneurs succeeded outside of their original domain. The Opportunity

23 So the Second Lesson I learned was that you can develop yourself towards stepping up to the opportunity. But you can’t conjure up an opportunity to suit your current skill level. The Opportunity

24 A concept’s success elsewhere is a small nudge, not half the journey.

25 I thought that because businesses like Dinnr have sprung up everywhere around Scandinavia, it will be a breeze to start something similar in London. Market Difference

26 What I didn’t expect is that success in one market shouldn’t be anything but a little nudge, and not contribute more than maybe 1% to the entrepreneur’s decision-making whether to start something or not. Market Difference

27 Different factors govern different Markets. Scandinavians have a very strong habit of “eating at home with their families.” The fact I came to know after my launch. Market Difference

28 My impression when I was packing my business up was that it was not a product for UK Market Difference

29 Not surprisingly the Third Lesson I learned that it doesn’t have to work in country 2 only because it works in country 1. Market Difference

30 Be your own worst critic, especially early on

31 I really would have needed a critic who said: “Look, you have the following problems: Show me your market research. What questions did you ask and how did you conclude it’s a good opportunity? Be Your own critic

32 Wait — are you telling me that in ALL your conversations you mentioned the product and asked for feedback? Well that’s a HUGE problem, you know that, right? Be Your own critic

33 Having someone spend an hour stress-testing my thinking and assumptions would have been gold dust and could have prevented a lot of effort wasted. Be Your own critic

34 Now I realize that I did not take advantage of many very smart people around me. I’m sure that had I asked 10 of them to spend an hour stress- testing my assumptions, I could have gotten something out of it. Be Your own critic

35 So ready to learn the Fourth Lesson! Here it is. Especially in the early days, you need to be your own worst critic and shoot down your own idea from as many angles as possible and question everything. Be Your own critic

36 Run a tight ship with development and design

37 We had offshore developers and designers who, despite coming with recommendations, didn’t execute well. The Core Team should be In house

38 As one of my first investors later told me, you must have developers on your core team in the same room. You need to be able to iterate and execute fast. The Core Team should be In house

39 There is no slower way than doing this with developers overseas, even if your company isn’t tech-heavy (such as Dinnr). Look everything I came to know later: The Core Team should be In house

40 So You should ! Take the Fifth Lesson now: That the core team must be in- house The Core Team should be In house

41 Professional design will not improve the business fundamentals

42 In April 2013, I had a great conversation with an entrepreneur who had successfully exited a home wares business. She told me that the main problem of Dinnr at the time was our amateurish website. Business Fundamentals

43 Hmmm! So we changed the layout of our website according to her suggestions, huge photographs, design elements etc. Business Fundamentals

44 The website was redesigned but the hypothesis of making it more visually appealing to attract customers didn’t work. Business Fundamentals

45 So ready to learn the next one! Here is the Sixth Lesson that you can’t design your way out of a fundamental business flaw. Business Fundamentals

46 Expect results faster and attach consequences to goals not reached

47 I should have spent more time beforehand to investigate metrics that we need to hit in order to continue. Investigate Metrics Early

48 Let’s get our first 100 customers. Bring these 100 customers to a repurchase rate of x. If x isn’t reached by date y, abandon project. If x is almost reached, tweak model for a while but don’t wait for too long. Investigate Metrics Early

49 Once a goal hasn’t been reached, it would have helped us to sit down and to decide that we had to change course no matter what. Investigate Metrics Early

50 Of course, this doesn’t mean that after a bit of trying, you quit. But having such a set of if- then would have helped in establishing boundaries to our plodding along Investigate Metrics Early

51 Last but not least, this is the lucky Seventh Lesson if you believe in luck anymore. that you must evaluate the reasons for not reaching goals from early stages. Investigate Metrics Early

52


Download ppt "7 Lessons I learned from the Failure of My First Start Up Michal Bohanes."

Similar presentations


Ads by Google