The Cost of Startup Advice
Today I threw my hands in the air in relief with a cry of ‘finally, someone gets it!’
I’m reading this morning’s StartupSmart newsletter and I come across the article ‘How you can score invaluable one-on-one meetings with some of the biggest names in the Australian startup community” which immediately piqued my curiosity.
In the back of my mind, I had already resigned myself to thinking ‘what’s the catch?’ but as I delve further into the article I read statements of ‘paying it forward’, I begin to grow more excited. Further statements such as ‘we want to lower the barrier to entry for new founders[…] and accelerate the learning’ quoted by Thomas Anbeek, had me on the edge of my seat in anticipation.
“we want to lower the barrier to entry for new founders[…] and accelerate the learning”
Here’s my moment of truth…. I have been somewhat disappointed by the current support offered by prominent startup ‘supporters’. There are a few organisations (though not all) that are easy to come across by a novice entrepreneur who is googling for information about support services. Be it excellent marketing or publicity exposure, there are some entities and individuals that stand out louder than others, and for someone just entering the StartupAus community, these people stand out loud and proud as supporters for new business, innovators and entrepreneurs.
So naturally in my search for support to help me with making the right decisions with my own startup Housemate Ninja, I started to research these support services further. I send through a little enquiry ‘hi, came across you in xxx, would love to know more about your services’- to which I am returned a phone call with an awesome and enthusiastic member of their sales team. (uh oh, I bet you’re already thinking…sales?)
This person loves my idea, but plays on my inexperience a bit, showing me the amazing value of their program. I agree, it sounds wonderful! What do I need to do to get involved?
“Well, there’s a fee. (oh yes?) But when you look at the services we offer and the people involved it’s all worth it! (ok, tell me the price already) it’s $xxxx (that’s FOUR x’s!! yikes) …a month (what the shit?) and you sign up for 12 months. (see ya later alligator…there goes my entire budget and more)”
Was I tempted…omg yes. I know I have no experience (in startups), and I know the value of having mentoring and support, but ultimately that incredible cost exceeded my development costs alone. For others in a better financial situation, (or who didn’t already have a HEC’s debt like mine) I could definitely see the value. Despite several follow up calls (by which time I was starting to get annoyed at being pressured into such a huge cost) I had to just say ‘no thanks’.
This is not the end of it. Other services gaining loads of publicity and awareness for their support for startups come with a several thousand of dollar price tag for their program and events.
So I know ultimately people pay this price for the value of the service if it is worth it to them, and if they can fit it within their budget that is wonderful.
But in Australia it is commonly argued that we are behind the times with funding and support to help a business grow, and most startups are bootstrapping their way to solid traction.
If we want to encourage entrepreneurship through education and support, and encouraging students to consider entrepreneurship, (this market which would be the least educated and experienced) why is the most prominent ‘startup supporters’ charging thousands of dollars to access this support? To a market that is probably in most need of support, most likely to fail, and most likely running on the tightest budget.
Events are being scheduled where ticket prices are pushing or exceeding a thousand dollars to attend. Amazing events that would surely benefit anyone wanting to grow, but are far beyond the reach of any ordinary startup that is bootstrapping. I am perplexed as to why these organisations that are so openly ‘supportive’ of new startups and entrepreneurs are setting prices this high?. This isn’t supportive. This is exclusive. To big money makers.
For some, $1000 is their startup budget, founders who bootstrap hard and don’t have the budget to attend the events they know they’ll get value from because they’re priced out of reach. Founders that don’t have the disposable income as some people looking to have a ‘dabble’ in startups. For those people, it’s make or break rather than a side project, this is their livelihood and a chance to create their own opportunity.
There are some amazing gems out there.
Now I do know there is a wider community and a lot of amazing gems in the startup world willing to give up some time to help, and since my earliest days of conception I have been amazingly fortunate to have some special one on one time for feedback including a breakout session with Phil Morle from Pollenizer during the 2015 SydStart conference and a quick chat with Pete Cooper from the Start Society and Natalie Goldman from Launch Pod who were each able to give me invaluable action points and feedback to consider in moving forward with Housemate Ninja.
This brings me back to my previous hallelujah moment.
It is so wonderful to see a dedicated event featuring a collaboration of leading entrepreneurs, advisers and successful individuals extending a hand to entrepreneurs and startups who seek a dedicated one-on-one. This is especially exciting because it opens the opportunity for someone at the very beginning of their journey to find a moment to ask where they can turn to for ongoing support, what options they have, how they can move forward on their journey.
And I know they aren’t alone, with similar events held in co-working spaces and around the country, but unfortunately these are less publicised due to lower funds than the screaming budgets of big players with big fees.
For me, Melbourne is still inaccessible at this stage (come on Qantas/Virgin — direct flights from Port Macquarie please!!), but it sparks the conversation and sets an example for other locations to follow suit. And I hope through my own experiences and growth that I may one day be informative and experienced enough to help others who are in my shoes at this point for the sole purpose of knowing what it has taken for me to get beyond my obstacles (and all the ones to come) so they have guidance to leap these hurdles with ease. I have put myself (WAY) out of my comfort zone and put a call out locally for other entrepreneurs, which has brought a wealth of talent and skills out of the woodwork that I didn’t realise existed in my community, all with a common goal to help one another.
What do we do about it?
If we want to see more success stories in Australia, we need to reach out to those in most need of support, because ultimately, valuable advice and guidance will have a greater chance to overcome the biggest hurdles that most likely cause failure. Share your experience and lessons to those more inexperienced so that their climb to the top is less of a struggle with a hand to help them along the way. I’m not saying give up weeks to help someone, but a few hours a month with a scheduled check-in and Skype chat or face to face will do SO much value to those who need it.
And as a final note, please don’t say you’re supportive of startups if you’re setting thousands of dollars in fees to access your help. You’re ignoring the key issues of your target market. Cash flow and access to capital.