Let it go, let it go… Sunset of my first startup: ratemyspeech.co
How I threw away my comfortable corporate job for a doomed idea… and why it was worth it. ☺
(If you are looking for a startup failure story like, you will find it here. When I started my entrepreneurial journey in 2014, I was young and foolish and maybe on an unconscious level I wanted to make all the mistakes a founder can. And in that goal I had a magnificent success in a form of the epic failure you will read about below. But since then a lot of things changed. For example, we are building a successful startup studio. And after researching dozens of the most successful studios — like Betaworks, eFounders — I created the Startup Studio Playbook. My readers keep telling me that the book opened new opportunities for them to reach their business goals. If you want to get the whole picture and explore how startup studios can benefit you, then go to www.startupstudioplaybook.com for more.)
It was a magical moment. Early last year I attended a Startup Pirates workshop in Budapest. We worked on a concept called Selftrace. We wanted to build a quantified self app, that combines all your health and fitness tracking data. Then it would synthesise it down to one health score. To tell you how well you are, in the most simple way possible.
At this time I was still an employee of Citigroup, but already knew that someday I’ll quit and build my own business. My plan was to work for a few more years, build up enough savings, and when I have a great idea, when everything is perfect, then I’ll make my move.
What happened, is that on the workshop I realised that I won’t be able to work for my employer any longer. The urge to start my own business got too strong. So at the workshop I took my phone, and wrote a mail to my boss. “Dear D, I loved working for you, but now it’s time for me to leave. I quit. Let’s talk next Monday.”
I felt liberated. Finally, I could focus on building something that has the potential to change the world. A few days later, when the workshop ended, we had to realise that we can’t make Selftrace work. We had to let go of it.
I just threw away my perfectly good career for nothing. #facepalm
But I was not worried. I still had about 30 days from my notice period, to figure out what I’ll do with my life. And just in time, there was a Hackathon-in-a-box event. I went there with the goal to join a team, help them realise their idea. As I was listening to the dozens of 1 minute intro pitches, I realised (as always on such events) that most people suck on stage. Shaking legs, voice, lack of confidence, unclear message…
Why isn’t there a service that makes it easier for people to prepare for speeches? Hmm, why isn’t there one? Hmm, why not build one? That’s it! Let’s build a webservice that will help people develop their public speaking skills! Let’s call this Rate My Speech!
Yay! The light bulbs went on, as I found my Next Big Idea.
The basic concept was simple. We let users upload their practice speeches, and our community will give constructive, actionable feedback on how to improve. And of course we had a gazillion other feature ideas, and of course we could already see how we’ll conquer the world.
We went to all the local startup pitch contests, and — maybe because we were in the business of public speaking — we could outpitch anybody. It felt amazing.
We pitched our way into Startup Sauna. Those five weeks in Finland were essential in transforming myself from employee to entrepreneur. It also gave a fighting chance for the concept, as our coaches kicked us in the butt (with love) and pushed us out of the building, talking to potential users, making us focus on the business.
On a hungarian startup competition we won a 2 week journey into Silicon Valley — all expenses covered. Fortunately I had to wait until January 2015 for this journey, about which you can read here.
Unfortunately, some months after the competitions, ratemypseech.co fell apart. There were just too many pivots, no clear direction that sticked for more than a couple weeks. The team scattered, we only had a crude prototype but no amazing product, and we couldn’t attract considerable number of users. This was my first serious, “all in” attempt to build a startup, and I managed to run into all the big mistakes. It was a painful, but valuable lesson.
In retrospect, these were the main takeaways:
#1 Too much ego will blindside you
I have to admit, I like pitching, and speaking in public in general. There is nothing better than standing on stage, in front of a huge audience, and wow them with your message.
Unfortunately, when working on ratemypspeech.co I spent way too much time on stage, and not nearly enough time talking to my team and our users. So while all the pitch competition wins kept my ego well fed, we didn’t progress enough with our concept, and our team.
Note to myself: Next time just forget about pitching on events as long as you don’t have an amazing product and an equally amazing team.
#2 DIY is nice, but you need a real team
As a consequence of #2, we didn’t have a CTO who dedicated enough time to our product. For some months, we got away with a slideware, then with mockups and paper prototypes.
For a while it was even fun. It felt like we are doing the proper thing, follwing the Lean Startup way of quickly building something (that is crappy), learning from it (unfortunately, many times not the proper thing) and adjusting (after a while we just went in circles).
But around July I just couldn’t take it anymore. I wanted a product. A real one. Not just a mockup. So what did I do? Instead of fully focusing on finding a CTO, or looking for other ways to get somebody creating the product, I decided to learn how to code and do it myself.
Coding was on my bucket list anyhow, so I figured, this is the best opportunity to make it happen. So I took a 2 week crash course in Rails, and then spent 2 more weeks of creating the initial version of ratemyspeech.co.
It was a painful month. On one hand I enjoyed learning how to code. On the other hand, I realised that I don’t want to do this. It’s just not for me. But I got what I wanted. Around August I launched a beautifully ugly ratemyspeech.co. From a functional point of view, it had 70% of what I imagined — user management, groups, comments and ratings, video embed…
I could cross off one of my bucket list items. But from the startup point of view, this was nearly not enough to compensate for the lack of an engaged team, and talented CTO.
Note to myself: Next time you just focus on customers and team building, and get people into your team to do everything else. Much better than you could do.
#3 If the concept is wrong, you’re doomed
Eventually I had to realise that our basic concept was flawed. Most people (95+%) just don’t care enough about their presentations. So they will not take the time to prepare a draft speech, upload it, expose it to scrutiny, then take the feedback onboard and rework it.
The rest, the less than 5% on the other hand takes it very seriously, and many of them have a strong network of people who they can ask. But they wouldn’t pay for some service to make this a bit easier. For them, we would not be able to deliver value.
I’m sure that after a while we could have found a market niche, where we could create some value. But that would be a very small market, and especially considering #1 and #2, we just couldn’t make it happen.
Overall, I’m glad that I made the hasty decision to quit. I’m also glad that I could let go of my startup idea. This enabled me to make a clean start early this year.
After Rate My Speech, I still wanted to build startups. But I was not satisfied with the common odds of startup success. So I was looking for a better, less-risky way of building an innovative business. This is how I ended up working as COO at Drukka Startup Studios.
We are a venture builder company, the fastest growing one in CEE region. This means that we build exciting new startups from own ideas, with our own team and capital. We are similar to legendary venture builders like Betaworks, Science-Inc, eFounders.
This model, the startup studio model takes out much of the risk from building ventures. And it’s spreading all over the world. If you want to know more about the startup studio model, trends, funding, then check out my research:
Update: Actually, you should not buy this short booklet. It was like a prototype to the real thing. If you are one of those entrepreneurs or innovators who wants to build businesses with low risk and cost and with high chances of success, then you will want to read the Startup Studio Playbook. It’s full of exciting examples and best practices on how to build your startups easier. If you want to know more, go to www.startupstudioplaybook.com for more.)