Lessons I’ve Learned From Spending $10,000 to School Myself in Business
Things that you should do and not do when launching a start-up
I was a man on a mission several years ago.
My greatest assignment back then was to discover on how to find a fulfilling occupation. I would always listen to TED talks while on my way to the office with the hope of searching for the most satisfying work to do for the rest of my existence.
That expedition led me to ponder more about human explorations on interest, passion and finding purpose.
Back then, I came across the idea of building a tech start-up company. I was fascinated by the fact of starting something from scratch, solving the problems of the world and putting a dent in the universe.
Every time I browse LinkedIn profiles, I was lured by the job titles and headline tags of a “CEO or Founder” of something that was attached to every name in my network.
I would read a lot of articles about start-ups to get a better lens on how to begin my business venture.
One day, I had a light bulb moment and founded the idea of building an application that would connect nannies and parents through a centralised podium. I initially thought that finding someone to look after the kids would be a hit for working parents because it was still hard to search for someone who was reliable and trustworthy enough to take care of their children.
My wife who happens to be my “Co-Founder” agreed to hire a tech guy to bring this concept into life. The search was difficult and it took a while for us to find someone who we can rely on in order to realise that idea.
Fast forward, we were able to build the application in six months and register approximately 1,000 users through the help of key players.
While my platform was able to extend help to its targeted community, I’ve irrevocably made up my mind already to end our start-up journey after four years of working.
Even if I had very good reasons to prolong the dream but putting more hours into it each day made me tiring instead of rewarding.
It was an expensive undertaking indeed and I sometimes wish that huge amount of money was rather invested in something else that was concrete. I wish I could’ve recovered a portion of the $10,000 that was spent but all of it went down the drain and sadly, I never received back a single cent.
I am sharing with you the reasons why I wasn’t able to recover anything from this costly experiment.
Focusing too much on the brand
I wanted to make some noise for my start-up and expand its reach. I’ve spent money in marketing by tapping a professional videographer to create infomercials for us, as part of the crusade. We’ve also onboarded a social media manager to get users sign-up the platform and take charge of our media campaigns.
There was nothing wrong spending on marketing since these expenses are essential to every business, what I’ve done wrong was coming up with a program without testing the idea if it can carry out its promise.
I’ve mentioned earlier that my start-up idea was initially a nanny search app but I later pivoted it to a caregiver search app because of the operational cost and stringent regulatory measures involved in the former that I wasn’t able to decode earlier.
The change of direction was due to the numerous demands for nannies in the platform but no structured connections were established since nannies were not engaging at all.
Some afterthoughts include the inability of nannies to buy android phones because it was expensive for them above all. In addition, they should be closely trained to use the platform given that most of them are not tech-savvy, unfortunately.
To pull it off, it would require us a lot of resources which we didn’t have at that time that we’ve officially launched.
Addiction to money and self-glory
I would always hope that the same destiny would happen to me every time I witness success stories on TV.
There is nothing wrong to dream big but visualising the success prematurely would shift you away from the real thing.
Instead of attending to the fundamentals of my business, I’ve also put too much weight to get noticed in the local start-up scene.
Ignoring the core features of the product
People would normally register and pay for training in exchange for knowledge in order to grow in a specific area of discipline or earn a large amount of money.
If that course failed to deliver that specific promise then expect people (who were disappointed with your product offering) to warn others and not fall for your sales pitch.
Instead of prioritising the app features that would establish a near-perfect match between two parties, I’ve dedicated time instead on elements that didn’t really provide user benefit.
Stubbornness to listen to mentors
I would recall this tech start-up coach who asked me — How will you monetise your start-up?
Then I responded to him with a long answer.
After listening, he gave me advice to be clear on how would I earn money.
I knew what he meant but I felt that there was a lot of work to do if we perform another facelift. So instead of diagnosing the root, we did manual interventions to forcibly align with the truth.
We were able to make things work on the sidelines but I’ve realised that it required a lot of human effort, which actually defeated the app’s purpose.
As a result, the platform seemed like a branding device rather than serving as a matchmaking tool.
Uncomfortably doing business with intended customers
After deciding to pivot my start-up to a caregiver search app — we have revised both our online and offline programs and still remained persistent after that.
Live forums and get-togethers served as my channel to get to know more about the caregiving industry. I’ve also got the opportunity to deeply understand the issues experienced by both families, patients and caregivers in our country.
Most of our caregivers are overworked and been rendering an average of 8 to 12 hours per day of labor. Getting a salary of 650 Philippine Pesos for the day (or around 13.50 U.S. Dollars) was an offer that they would accept at face.
Meals are not automatically part of the package; if it does, then they consider it a bonus.
Aside from having menial pay, sometimes they get physically abused by patients — most of them done involuntarily. A caregiver assigned to an elderly must be truly understanding in their duty because the fading health or mental condition of their patients is causing such irritability.
In summary, it was clear to me that their job of taking care of the elderly should never be treated lowly.
On the other hand, patients and their families have also their versions about specific caregivers that were lacking ability. Families would share to me incorrect medications given to patients and at times stringent protocols were not observed during the course of their duty.
After hearing both sides of the story, I contemplated if I was set to make money from them eventually.
Given the circumstances of both parties and the loads of stories I’ve heard from them collectively, I had reservations to pursue making money from them considering that they have too much on their plate already.
Yeah, there is nothing wrong charging them a platform fee for every successful connection to be made in the upcoming but it was just me who is not comfortable since I felt I would just add up to their anxiety.
Disbelief in the start-small-and-dream-big concept
I chose to jump on the bandwagon with an enormous product because I was secured that I can self-fund my own start-up.
If I had to do things all over again, I should have thought of coming up with an MVP (Minimum Viable Product) where a selected population of users would test it then give us feedback after, if the product is working as expected.
Through this reality check, we can diagnose the breaks during the early stage of the project.
What I did was to go all-in and went ahead with the concept, design and its development. We made an end-to-end test of the app when percentage of completion was already at 85%.
I’ve ended up burning more cash, which was beyond my investment budget. I’ve sought inventors later to fund it but I was unsuccessful to even find one who was willing to infuse capital on it.
This is what you get if you are too excited and if you skip the process; take one small step at a time and be patient.
A surge that was too much to handle
I would receive complaints and personal apprehensions almost every day from both sides of my users. They would normally fill up my inbox and consume much of my time through lengthy discussions.
Now, I understand that I’ve always wanted a business that is lean and manageable. A venture that is commensurate to my lifestyle and to what matters to me the most.
In addition, being the CEO of my life is my primary role. I wasn’t willing to trade off my bonding time with my wife, playing and homeschooling time with my children and most all my prayer time with God.
End of the day, the very reason why I work is to invest eventually my earnings on the value system that I hold.
Success is meaningless if it is merely intended for personal gain after all.