I shut down my startup on my birthday.
Not how most people spend their special day, I know. However, I spent its morning telling my team we were shutting down Grad day Photos, and the rest of the day convincing myself it was the best thing for us. After 4 long years; a great product and a great market part ways. It’s been fun, it’s been hard.
Up until earlier this year my favourite line was “700 customers can’t lie, we’re onto something here”. I said it to my family, I said it to friends, advisors and anyone that would listen. I really believed it.
We started Grad day Photos in our 2nd year at university. Our first event went pretty well. We had 130 customers, made N1M ($6600 Pre-Buhari).Our target was 300 customers, funny, we weren’t even ready for 50. In a blink everything we hadn’t even thought about came crashing down like meteors. Sorting out 130 peoples pictures, editing each one. It was chaos. I literally hand delivered packages to customers at the airport minutes before their flight. There was even one customer I brought the wrong package too. I lost weight, we all lost weight but we learned the hard way that process is everything. Now we look back and just laugh about it, it made us who we are today.
We’ve explored every thing imaginable for marketing to graduating students. Over the years we’ve refined our approach and focused on the most effective channels. On campus events, sign ups, SMS ,emails,and recently whatsapp marketing. Yeah, that’s a thing. We simply call potential customers, add them up on whatsapp and send them pictures of our products. They could ask any questions they had right there in the app. 1 in 10 students we chat with book with us. A large number actually place their orders via whatsapp. We use it to track orders, handle queries & get feedback. Super effective, super lean.
The Market doesn’t lie
Now we’re at 1000+ customers, we work a lot smarter. We’ve built software, automated processes and learned so much about our customer, the system and all things Graduation. Revenue was growing, orders were growing. Everything actually looked promising.
Taking a deeper look though, orders at our biggest schools were growing by just 5–10% yearly. Revenue had increased because our prices had increased, but our costs had also increased (Post- Buhari) so our margins were still about the same. So even though it felt like we were doing a lot more. We were still making the same amount of money. We were hitting 5–10% penetration rate of each graduating class at some of the most expensive schools in the country. Assuming penetration stays the same at larger, less expensive federal schools. The logistical costs of serving more customers would still eat into any benefits of scale.
Disrupt or not
So I asked myself a few questions. Is our service really disruptive? Is our product more convenient or cost effective than the traditional way of doing things? In harsh reality, it wasn’t.“Wait & get” photographers take your picture right on the spot and print it out for N250. Even though the quality is abysmal, many settle for it. So our selling point was always quality. We've never tried to compete on speed and price just more value for your money.
So how many graduates are willing to pay more money for great graduation pictures? Unfortunately not enough to validate our business, the 6–9 month sales cycle, the inter-state journeys and all the time & energy we had put in. Most importantly, the fact that it all came down to the day. After that, our relationship is over.
Numbers tell the truth
Earlier this year we launched Myphotographr a platform for people & photographers to print & frame photos. At first it was a side project to maximise the time in between graduations. Also to give our existing customers a platform to continue patronizing us. However it made me more conscious about our numbers. Separating the two different revenue streams and accounting for the associated costs. Measuring which was more profitable though ; our newcomer came out on top. We've actually made more profit this year from myphotographr than our 4 year old Grad day Photos. The harsh reality hit home, we need to go back to the drawing board (says the Nigerian olympic committee).
Follow the Money
As aggressive as it may sound, this really is the premise of business. Don’t let them deceive you, revenue (or some sort of measurable value) fuels passion, especially in this economy. So this is what we are doing. Focusing our energy on the things that add value. Focusing on growth, customer by customer. Talking with them, finding out a bit more about what they want, why they want it. Building on our experience and using technology to meet customers at their point of need.
So Goodbye Grad day Photos hello MyPhotographr.
Even in the recession, there's still an owambe every weekend, or a friend’s birthday to attend. Life events are happening all around us. With better smart phones we get to capture more of these life moments. Now we are helping people preserve these moments better. Put them on paper, hang them up on a wall.
It has been a long road to where we are and there's even a longer road ahead. I’d like to thank all the people who shared the journey thus far. All of our 1000 customers who I frequently bump into. I don’t underestimate the privilege of sharing that moment with you. In fact we hope to share more with you in the near future.
Thanks for reading.
Print a picture;)