My First Sunset 🌇
I started giftsing to fill a gap: there was no efficient way for me to tell family what gifts I wanted for my birthday or Christmas. As I listened to podcasts & read material from other founders, I came across an intriguing concept regarding why founders start their companies. It’s something I haven’t come across in anything I’ve heard or read:
Some founders start companies to pursue a dream.
Others start companies to fill a gap (me).
This is an interesting difference because it speaks to where they get their passion & drive from, if they’ll operate in a saturated market, etc…
Do a sunsetting retrospective
To turn a failure into a “positive learning experience” means to reflect on what went well, what didn’t, & what could have been done different. Sprint retrospective 101 applied to running a company.
What went well is listed further down as the skills I’ve gained. What could have been done different is at the bottom in my “Takeaways” section. What didn’t go well can be summarized in 2 points:
- I didn’t do enough competitive analysis. The decision to sunset giftsing started while I was researching keyword ranking. I saw a competitor out-ranking me who I didn’t see in my first competitive analysis. Their website looked solid, so I decided to take another look at my competition. While I was prepping my spreadsheet, I broadened my initial weak analysis from a laughable 1 metric to 70+ quantitative & qualitative metrics in 7 areas (business, usage, service interface, website social proof, website moz stats, service features, social media presence).
I also screwed up by not doing this analysis frequently enough. Next time I’ll do it once/year instead of every 2 years.
To be clear, this new competitor wasn’t the reason why I’m shutting down. The reason I’m shutting down is because both them & my main competitor have more users than me, have the same & more features as me, have larger teams, revenue, & more experience than me. I knew one competitor existed, although I didn’t know they had all the same features as giftsing (back to my weak-ass competitive analysis), and I was still willing to take them on. Add the stuff in bold above to this and I’d have to change my business so much that incumbents couldn’t easily replicate me. After brainstorming, I couldn’t come up with any pivots so significant that I thought it’d make a difference, without bankrupting my savings account. Plus, my original motive for starting giftsing was to fill a gap, which these 2 companies did better than me.
- I didn’t have enough users. After 4 months of being active, I had less than 100 users & almost no daily active users. There were tactics in the pipeline to address these (free content to bring people in, drip campaign to stimulate usage, et al), but these tactics would triage a deeper issue: my users should have been involved before my MVP was created. Now I know a founder should find users before they build an MVP, & use their feedback to
- validate the idea
- build & perféct the MVP
- be the first users & gather more.
I was the sole user whose feedback I considered for most of the MVP. I involved family & friends in alpha testing, but I should have had 10–20 people who didn’t know me deeply involved from the start. The product would have been better, it’s likely they would become users post-launch, and they may have turned into evangelists & spread the word about giftsing.
Positive Learning Experience
It’s not all bad. I’ve grown immeasurably & the things I’ve learned have been incredibly valuable (and probably cheaper than college). Here’s a quick list of my new skills and level:
* Graphic design — beginner!
* UI/UX — beginner!
* Video production — beginner!
* Business planning — beginner!
* HTML, CSS — beginner!
* CakePHP — beginner!
* Marketing — beginner!
* Social media marketing — beginner!
* Bootstrapped startup resources — intermediate!
* Extroversion (I’m an introvert) — beginner!
* Time management — intermediate!
* Legal — beginner!
* SEO — beginner!
* Customer segmentation — beginner!
* Competitive analysis — intermediate!
* IOS product management — beginner!
* Copy writing — beginner!
* Stress management — intermediate!
Yay for me, right? Added to these will be how to shut down a company, which will be a whole project by itself, like how to close down a business in Texas, trademarks, taxes, etc…
Takeaways: Do in-depth, broad competitive analysis annually. Involve users starting with ideation.