The startup industry is booming and more and more companies aim to harness entrepreneurship by creating internal innovation centres. After spending a year as an intrapreneur and experiencing some real highs and lows, I’d like to share the insights gained throughout my journey with (aspiring) entrepreneurs and intrapreneurs.
An unexpected journey
It all started around Hallowe’en 2014, at reed.co.uk’s biannual Hack Day. The company wanted to diversify its portfolio and challenged employees to come up with ideas we could spin off into startups. While brainstorming in small groups, we discussed the growing popularity of startups. We knew loads of people in the tech community who were interested in joining a startup and we’d met plenty of founders who were struggling to find the right people to expand their teams. Based on these needs, we dreamt up a platform connecting people with great ideas (or early stage startups) and talented people interested in joining a startup. We created a working prototype and an elevator pitch and at the end of the 36 hour Hack Day, the judges picked Startup Startup as the overall winner.
This turned out to be the beginning of an incredible journey. The next couple of months consisted of early market and persona research, writing a business case and pitching the evolved idea to our Board of Directors, while still working our “day jobs”. There was some skepticism around the business because previous intrapreneurial attempts had failed. The individuals involved hadn’t been given the opportunity to fully devote themselves to the idea and continued to be distracted by other responsibilities.
This time, however, would be different. Mark Ridley, reed.co.uk’s Director of Technology and driving force behind Monday Labs, the company’s new innovation centre, had secured a small office above a Reed Recruitment office. The office had been redecorated and turned into a creative space where intrapreneurs would have the freedom to focus on innovation without having to worry about BAU. Startup Startup eventually got the go-ahead and on 9 March 2015, our founding team of four (David Bishop, Darryl October, Iñigo Gomez and myself) moved to our incubator office in Islington, London, to turn our hacky prototype into an actual business.
From concept to traction
Before we wrote a line of code, we focused on immersive persona research. Being in London, it was easy enough to meet the people we hoped would be using our platform. We spent time in co-working spaces and Google Campus and attended countless startup events. We ended up with a very clear picture of our user personas which helped us prioritise (and discard) features. As an added benefit, we met some amazing and inspiring people, who were more than willing to donate some time to give us feedback or help us with user testing once we’d created some interactive wireframes.
Over the next months, we evolved the website from just a landing page to an MVP and as soon as we were confident it was “good enough”, we launched Startup Startup in June 2015. To say that it went viral would definitely be an overstatement, but the amount of traction it generated certainly exceeded our expectations. In a couple of months, we managed to grow the community to well over 10,000 members from around 100 different countries, with close to 1,000 startups and ideas. Perhaps unsurprisingly, our entrepreneurial audience was more than happy to continue to provide incredibly valuable feedback which helped us identify improvements and iterate on the success of the MVP.
But what does success look like?
In many ways, Startup Startup was a bit of a guinea pig. Not only for us but also for reed.co.uk. As the first startup to come out of Monday Labs, we were all still working out what worked and what didn’t.
Looking back now, I must say we did get some aspects of it absolutely right. The decision to separate teams of intrapreneurs from the core business paid dividends. As an independent team, we had full autonomy to make any decisions. Without red tape or other distractions, and a small group of highly motivated and empowered individuals, it’s fair to say we surprised people back at the “mothership” with our speed and quality of development.
At the same time, there were plenty of things we didn’t get right. The opportunity to work on Startup Startup was initially a three month secondment for all of us, and reed.co.uk’s investment was also stage-gated. Simply said, we had three months to “prove that the concept worked” and then go back to the board, present our findings and — if appropriate — pitch for more investment. As much as I believe in this approach, I would now argue that it would have been more effective to base stage gates on metrics, rather than time.
The main problem the time-based gates posed was that we were working towards a deadline, without having a shared vision of what “success” looked like. As the founding team, we had ideas about identifying and developing the MVP, and achieving early traction. When it came to pitching back to the board, however, it turned out they were more concerned with the commercial aspects of the venture (i.e. how close we were to monetisation). Without arguing the case for either perspective, the main problem was clear: there was no clear, shared understanding of what we were working towards. This could have been avoided if we’d set a metric-based gate (“you will unlock the next round of funding if you achieve X”) rather than a time-based gate.
Our biggest challenge from the start was proving the value we could bring back to reed.co.uk. Monetising a solution catering for early stage, cash poor startups and entrepreneurs was always going to be a big ask. We didn’t go in without any ideas on how to monetise Startup Startup (in fact we maybe had too many options), but the approach was very much along the lines of “if we can build a large, engaged community, monetisation won’t be a problem.”
This attitude isn’t necessarily bad (look at Twitter as an example), but it works much better for startups that can rely on raising larger and larger rounds of funding to bridge the gap between traction and profitability. For a company investing in an internal startup, this is not necessarily an interesting approach — and it certainly wasn’t for us. One of the lessons we learnt collectively was that from the outset, the expectation of how and when a startup or initiative should bring value back to the parent company should be very clear. Once you know what you expect from an innovation, it becomes much easier to identify which ideas do and which don’t meet the brief.
The return journey
As reed.co.uk’s first internal startup we definitely helped identify our strengths as a business and played a big part in discovering the type of innovation the company wants to invest in. Unfortunately, we ultimately came to the realisation that the Startup Startup model wasn’t the right fit. To stay true to the Lean Principles, we avoided investing any more time, effort and money in further developing what turned out to be the final iteration.
As people were still using the platform and Startup Startup had always been a more or less self-managing community, we decided to keep it live. After running into some technical issues that prevented those still using the website from getting the most out of it, we decided to call it a day in May 2016. Between June 2015 and May 2016 150,000 users visited the site, spending well over 10,000 hours engaging with the community.
Let’s be honest here, of course “failure” hurts, especially when you’re as passionate about an idea as we still are. However, as advocates and practitioners of Lean and Agile, we’ve always been aware that it’s part of the game, and I for one can tell you that lessons learnt from “failure” can be very important and powerful.
I believe we all learnt loads from the experience, and moved on to bigger (and perhaps better) things. David continues to pursue the startup dream, having raised funding for Love the Sales, the startup he ran as a side business for a couple of years before going full time in July 2015. Darryl and Iñigo have helped shape Reed Commercial, one of reed.co.uk’s other innovative initiatives. Iñigo is now using his creative talent to re-imagine other parts of the reed.co.uk product set, while Darryl’s still working on making Reed Commercial great, although now based in Barcelona. I’ve been involved in some interesting new products and projects and am the Product Owner looking after reed.co.uk’s digital sales channel.
All in all, working on Startup Startup allowed us to pick up new skills, demonstrate our creativity, prove how much a motivated team can achieve and move back to the “mothership” with some great insights on how to achieve more in less time and be fully customer centric. Sure, there were some disappointments along the way. Would we do things differently if we could go back in time? Of course we would, what’s the point in trying and failing if you don’t learn from it? Would we do it all again though? In a heartbeat!