From First Raise to Exit: 5 Insights on Scale
Noga Edelstein, Director of SBE Australia, shares what she has learned through scaling and successfully exiting her startup UrbanYou.
It sounds like a dream run. I took the leap from corporate to startup, quitting my job as General Counsel of Yahoo! to build UrbanYou, a two-sided marketplace which transforms the way busy people find and book household help. We raised $2M in venture capital, led consolidation in the Australian on-demand home service sector, rolled up two of our major competitors, and were ourselves acquired by the Domain-backed marketplace Oneflare — all within the space of 6 years. But I can assure you that it was one hell of a bumpy ride! Here are some insights I gained along the way:
1. Do things which build resilience
In my late teens and early twenties I wanted to be a professional actor, and scored a number of roles in stage, TV, film & radio productions. Nothing builds resilience and prepares you for failure like the experience of auditioning for acting roles! In many ways the audition process is very similar to pitching for investment, and this early experience taught me that after each “NO” I simply had to pick myself back up, believe in my ability, and move onto the next opportunity. It took us 18 months, 100s of coffees and countless “NO”s until we successfully raised our first round of investment. But we persisted and growth exploded, with revenue growing 10X in less than 3 years.
2. Find something that’s broken, and fix it
In my busy corporate career, I noticed my colleagues complaining that they never had enough time to get things done around the house. Yet the process for finding and booking household services was still a frustrating, offline, broken experience. I met my co-founder Elke when we both worked at Yahoo!, and it was clear to us that the $15B home service market was ripe for disruption. Our “aha moment” came when our Yahoo! colleagues all started downloading Uber. We realized we could use technology to create a scalable, on-demand experience to transform offline home service industries such as cleaning and gardening.
3. Stay calm under pressure
I spent 15+ years working in senior executive roles at global technology and media companies including Yahoo! and Foxtel, as well as top-tier law firms in Sydney and London. As a corporate lawyer I negotiated multi-billion dollar deals under insane deadlines. None of it compares with the stress of running a startup! But I’ve learned that in stressful situations, I can achieve a far better outcome if I take my time and think clearly rather than panicking. At a pitch competition I was once thrown a curly question about the size of our target market, and my mind went blank! But I took a breath, reminded myself that I knew my business, and gave a thoughtful answer. We won the competition, and it led to us meeting our first angel investor.
4. Treat your “enemies” as your “friends”
Get to know all the players in your industry, rather than treating them as “the enemy”. This approach served UrbanYou well, especially as we started to think about consolidation opportunities in the Australian market, because we were the first to be approached by competitors looking for strategic opportunities. In 2017 we acquired cleaning marketplace HomeHello, and the following year, we were in the process of closing a fundraise when Oneflare approached us about a possible acquisition. We were able to look at this opportunity strategically and see that combining forces gave UrbanYou an unparalleled opportunity to own the Australian market, which has indeed proved to be the case.
5. Accept that your startup has to grow up eventually
Undoubtedly the hardest part of exiting was relinquishing control of our startup — just ask any founder whose company has been acquired! At first it felt like watching someone else raise my baby, but I came to see that it was more like sending a child off to University. So once you’ve hit your stride, found your market, found partners and are ready for that exit — treat the company like a teenager and let go of the reigns. And always take the time to celebrate your success.
Scale takes crunching numbers, making hard decisions and staying focused on the end goal, but my 6-year startup journey was a rollercoaster ride that continually took me by surprise. By building resilience, fixing a really big problem, staying calm, getting to know my competition and eventually being okay with letting go — I was able to successfully scale my startup and achieve one of those rare things, a successful exit!
Noga Edelstein is an entrepreneur, start-up advisor and non-executive director, passionate about disruptive business models and fostering entrepreneurial capacity. She co-founded startup UrbanYou, a platform to book trusted, pre-screened household services on-demand, which was included as one of Westpac’s Top 200 Businesses of Tomorrow. Noga exited from the business in March 2019, and is now working on her next big thing. She is regularly invited as a panelist, speaker and mentor for organisations such as Inspiring Rare Birds, CeBIT, EY, UNSW, Cicada Innovations, Tank Stream Labs & Tech Ready Women. Noga is Director on the board of SBE Australia — Springboard Enterprises which was rated as Australia’s #1 Accelerator program by founders.
