We are two
Happy Birthday to us, well, to my company Powered Now, we are two years old today.
Two years may not seem very long, however in the life of a technology startup its a key moment. US census data, which usefully tracks businesses as well as people claims 48.8% of new companies fail in the first few years. However focusing on ‘startups’ its even worse with an 80% failure rate within the first 18 months (according to Bloomberg). So getting to two years old is a major achievement which I’m really proud of.
As a reminder, our business ‘Powered Now’ builds software for the field trade world. This is a fancy name for builders, construction workers, plumbers, electricians and many more. Our product is all about workflow and management, our users can raise paperwork and run their companies from anywhere, its available on iOS today and everywhere else soon. This is a sector of the market thats been frankly underserved by the technology revolution of the past 30 years. Its also massive and no amount of sizing can prepare you for an industry that is frankly everywhere, the next time you walk down your street just count the white vans or pickup trucks, it will surprise you.
My two business partners and I came from the e-commerce industry, we had been previously successful with a mix of software and services into the SME sector. One of the services we knew inside and out was payments, we’d set up our own payment product just a few years previously. This was one of the catalysts for deciding to do something new and disruptive, tradesmen and women have problems with payment right? Well we were right and wrong as it turns out, this blog post will try and cover some of our learnings.
This post isn’t supposed to be retrospective, though we are only two years old I could write for days on our history. Like most startups its been a rollercoaster and there are a lot of stories, however to understand the lessons I need to dive back to the beginning a little. Also this post is much for me as it is you, so apologies if it seems narcissistic in places, not my intention. To some extent you have AMCs Walking Dead to thank for this post, there is a great scene in this weeks episode where one of the characters (Noah) is encouraged to write things down so he doesn’t forget the history, hopefully no Zombies here though.
The early days
I regard today as our birthday, its the day the very first version of Powered Now was approved and released by Apple on the App store. However these things are not immaculate conceptions, there was a long pregnancy full of pivots, perseverance and powered by a lot of Hungarian beer / goulash / nightclubs. Our original idea was actually different, thats a subject for a separate post, but our MVP hit the shelves on 19th March 2013 into the hands of a waiting audience, and this was a key point. During the early development both myself and one of my co founders had been busy hustling. We spoke to hundreds of potential users both face to face and on the phone, I was also running a Dropbox style landing page powered by adverts to build a list of early adopters. We also instrumented everything, from day one I was driving Zoltan our technical founder crazy with demands for analytic SDKs to be in the product, I think at one point these SDKs were actually larger than the product codebase!
An early March launch wasn’t the original plan, we actually wanted to go a little later but our timetable was brought forward by a phone call I had just after Christmas from the Editor at TNW, we had been selected as a finalist for The Next Web startup rally in Amsterdam. Having previously been to TNW I knew what to expect, a Dragons Den style grilling from the great and the good of the tech world while being on stage in front of hundreds of people and a live stream that went to tens of thousands. This is not the type of thing we take lightly, we had to get it right. I won’t go into the full details in this post, there are so many stories about this time in our lives including one that involved snow, power cuts and the flu, I get cold sweats just thinking about it. However I will say that for three months we worked our butts off. Christmas was a blur, families and friends were frankly ignored (sorry if you are reading this), all for the goal of getting to TNW with a product that was in our customers hands. I don’t think I am exaggerating when I say by the time TNW rocked up our whole team was done, there wasn’t much left in the tank. Then two things happened:
- We won (We actually won the Best Mobile App)
- Life exploded
Winning TNW was the ignition our business needed, and it moved us nicely into a second phase of our companies history.
Raising money
For the first 18 months of its life Powered Now was bootstrapped by its founders, both in hard cash and time. This wasn’t easy, we were growing really quickly but to maintain our growth and while accelerating the business we needed more staff and a bigger budget, we had to raise capital.
For my business partner Chris, this wasn’t his first rodeo and I’ll never forget his advice to me:
“prepare yourself for a lot of rejection”
Now being a smart arse frankly I didn’t believe him, after all we have the team, product and track record right? Looking back I don’t really know what I was expecting to be honest but raising money is damn hard work. We pitched everywhere from restaurants (I still know the Cotê menu off by heart) to organised Angel Investor meetings, we visited the top tier accelerators and Venture Capitalists, it was crazy.
Back at TNW I met a brilliant lady called Beth Susanne, she is a pitch coach that specialises in taking cocky entrepreneurs putting them on a fast spin cycle and producing a pitch that is worthy of being listened to by investors. I’m no stranger to speaking at public events, I’ve done it a lot and perversely enjoy it, however pitching is a different science completely. Beth was great, and if you are just about to go though the process of raising money I can’t recommend her highly enough. Beth also told me an interesting fact, in Silicon Valley the average time for a startup to close $1M in seed / early stage capital is about a year.
As it turns out Beth was right, we raised just short of $1M and it took us nearly a year to do it. Our round was a combination of a fantastic bunch of angles, some we met at pitching events, some we knew before and Crowdcube, the largest crowd equity funding platform in the world. The decision to list our startup on Crowdcube was easy, those guys are on fire and they are really shaking up the traditional investment landscape for early stage businesses. However ultimately we are changing an industry that is surrounded by incorrect preconceptions. This made fundraising quite hard, even with a great track record and a fantastic product. When you are pitching to a room of investors, a workflow product for builders isn’t as sexy as a Bitcoin wallet for African hipsters (I actually saw this being pitched by two different people), regardless of opportunity. Crowdcube widened this opportunity and along with our angles helped set us on track for the next stage of our growth.
With our raised capital we have done two things:
- Increased the team, there are now 9 of us both in the UK and Budapest. We also opened our development office in Budapest, if you are ever in the area pop in for a cup of tea.
- Focused on nailing Product — Market — Fit
Product — Market — Fit
Over the two years since launch we’ve been obsessive about getting our product into the hands of our users. It all started with the first version and today we are on the smartphones and tablets of thousands of companies all over the world. This growth has been a real goal for us, but without going all Lean Startup our focus has been very much to build, measure and learn.
One of the lessons over the past year as we have transitioned from a boot strapped outfit into a serious business is that moving from a great product to a world beating product is really hard, making this jump isn’t easy, but essential if we want to reach our ambitions.
I’ve met a lot of startup founders and I’ve noticed there is a tendency to think a little binary (I include myself in this from time to time) about our products and companies. We all tend to fall into our respective camps when challenging ourselves as to what makes our product stand out, whether its technical, features, UX or services such as customer support. The truth is, the whole is more than the sum of its parts; features, UX, customer support and marketing. It all has to work together for startups to cross the chasm and its a challenge, its our biggest challenge as we turn two.
A secondary challenge I am setting myself is to really focus on measuring the progress we are making with our product. We’ve aways done this but the next twelve months is critical for us in terms of adoption, hitting key milestones and most importantly feedback.
Getting to two is a huge step and there are literally hundreds of people that have helped make this happen, I’d like to name a few here and I am sure I speak for all three founders:
- Our investors, we couldn’t do this without their support. Special thanks to Darren, Luke and the team at Crowdcube.
- Our advisors, Bill and Paul, keeping us honest and focused.
- Our customers, anyone thats downloaded Powered Now and especially those that have sent us feedback, both good and bad.
- Our families, founding a startup is hard and they can bear the brunt of this, thank you for letting us do this.
Thank you,
Ben
Resources you might find useful and I’m focusing on until Powered Now turns 3:
- Jason Calacanis wrote an excellent post entitled ‘The Age of Excellence’, while the post is a little old I think the points made are even more important today then they were when first written. Jason is often on the money and I really suggest that you subscribe to his blog and newsletters.
- The Lean Product Canvas, I don’t think it matters how big or established your company is, the lean product canvas is a great method of getting down into the detail and quickly. I plan on revisiting this a few times during the year.
- Making sure I and the people we hire continue to pass The Airport Test, in this day and age I think its easier than ever before to become an asshole. I don’t want to be one (insert sarcastic comment here) and I don’t want to hire them. I’ve seen companies at our stage of growth implode due to bad hires and founders falling out, no thanks. Thank you George for introducing me to this.
- Similar to the above but with Relationships, continuing to build and nurture relationships with customers, suppliers and partners is essential to us as we grow. Matt Bird wrote an excellent book and has a fantastic blog on this subject.
