Image for post
Image for post
DANIEL SIEMASZKIEWICZ, SHAWN ZVINIS, ABDUL NUSRAT & CHRISTOPH SASSENBERG

Tab: Startup To Shutdown

The mistakes an angel and accelerator-backed startup made and what we learned along the way.

Tab (previously Subscrib) was a web-based prepaid loyalty app that started in the basement of Campus London in late September 2012 by Shawn Zvinis, Christoph Sassenberg and Gary Luce.

1. Building a Random Team

My previous startup did not see the light of day, even though I spent almost six months working on it, because I did not build a team. I thought I was a master of my trade and that I could do everything myself. It turned out that I was wrong about that.

2. Raising Too Little Too Early

As co-founders, we all had different (short) personal runways, which made money a real concern. Early on, we were lucky enough to meet an angel investor from the finance space that wanted to put the first money in to Tab. We thought this initial seed money would not only solve our cash-flow issues, but would also be a great signal for other investors and would allow us to build our first product.

3. Building a Not So Minimum Viable Product

In September of last year, we had lunch with a friend. He suggested that we should find a way to test our idea without writing any code. We were always talking “lean” and this was the opportunity for us to walk the walk. We took their advice and instead of building an app, we printed numbered business cards that we used to identify customers in shop and we printed a simple ledger that our first pilot locations used to keep track of balances and transactions—our paper prototype.

4. Focusing On an Accelerator Too Early

One of the General Partners at Seedcamp happened to be the first consumer to use Tab at our very first pilot location, the cafe at Google Campus in Shoreditch, East London. We got excited about the idea of being a part of Seedcamp and what it could do for us as a company: open doors, keep our ticking time bomb going and provide us with a stamp of approval for future fundraising.

5. Going to The USA at the Wrong Time

One of the biggest opportunities Seedcamp offers new portfolio companies is to go on a 3-week long trip to New York, Boston, San Francisco and Silicon Valley. We visited some of the biggest names in technology including Google, Facebook and Foursquare, and pitched some of the best venture capitalists around. This trip really opened my eyes as to how different American founders/investors are compared with the more relaxed and timid European counterparts we were.

6. Starting Scaling Too Early

As we had already raised some funding and joined Seedcamp, we started regularly interacting with investors as they came in to the office and at other events. The majority of the investors we spoke with warned us that they would need to see proof that we could scale Tab beyond a couple pilot locations. They wanted us to prove that we could execute our ambitious plans on a smaller scale.

7. Overvaluing Qualitative vs. Quantitative

At the end of the day, shops wanted two things from Tab: to make more money and to save more money. Anecdotally, Tab did just that and increased the spending of customers and saved shops money by bundling card payments. The problem was that we were not able to show this to shops.

8. Not Generating Any Revenue

As we were using shops as guinea pigs for customer and product development, we offered Tab for free to shops. This made it very easy for us to sign up new shops, especially when they saw their competitors in the local area were using Tab.

9. Not Building a Financial Model Early Enough

We did not build any real financial models until one of our existing investor asked us for one. I mean, we wrote on the back of napkins and that sort of thing, but nothing that looked at how the company would scale in the coming years.

10. Putting All Our Eggs in One Basket

We quickly realised that direct sales was the best approach to convert shops in to piloting Tab, so we put all of our eggs in one basket and focused solely on direct sales. This meant that we never really tested online sales or teaming up with a distribution partner.

What’s Next For Us?

Tab will be turned off on December 31st, 2013—until then shops will be able to debit accounts, but not accept new top ups or new signups.

Written by

Get the Medium app

A button that says 'Download on the App Store', and if clicked it will lead you to the iOS App store
A button that says 'Get it on, Google Play', and if clicked it will lead you to the Google Play store