Lessons from Chris Bailey, co-founder at Hotel Tonight

8 Ways to startup success

Hacker Unit
Welcome to the Unit
5 min readFeb 10, 2016

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“Don’t wait too long.”

Chris Bailey is a co-founder of HotelTonight, a mobile-only product allowing users to book great last-minute hotel rooms at competitive prices. Though it shares a space with giants like Expedia, Priceline and Booking.com, the app is extremely successful and, since its inception five years ago, continues to expand all over the world.

In this masterclass for HackerUnit, Chris tells us why HT has performed so well (“you need a really great product”), has continued to do so (“we take customer support seriously”) and how to get good ratings on the app store (“pay a lot of attention to the design and offer a product that’s bug-free”).

With far-reaching success so far, Chris and the team have high aspirations for the future of the hotel-booking space. “We are aiming to be the next big travel company.” Prior to the mobile-only app, Chris worked with five startups, though none achieved the triumph of HotelTonight. His wealth of experience is captured in his eight steps to startup success below.

1 • Create a really good product

Chris insists that the secret to building traction early on, in the absence of big advertising bucks, is to focus on two key things: creating a quality product, and organic reach, via social media and word of mouth. “We had a top rating on the app store because we built a truly great app,” he explains. “We ensured our rating stayed high with stellar customer support. I highly recommend, if you’re in a very consumer-heavy space, that you do not ignore support.”

2 • Disagree & Commit

Recalling one particular feature the HotelTonight team worked on, Chris reinstates the importance of good communication, collaboration and process. “This one feature was pretty heavily debated and discussed, with a lot of of different ideas and opinions across the team. There were many iterations, and development took a long time.”

“You will never be ready. Don’t wait to be ready.”

The misunderstandings during the process ended up being a good learning experience for him and the team. He points to a philosophy made popular by Intel: Disagree & Commit. “I believe in having good, tough discussions, but, in the end, once a decision is made, the team should commit to it, move forward and deliver their best.”

3 • Embrace the emotional roller coaster…

Building a startup will be an emotional roller coaster. Ups and downs over funding (or lack of), curve-balls from competitors and employee challenges are just some of the issues you’ll face. “Embrace the roller coaster,” Chris says, “and know that, overall, it is extremely exciting and fun! Anything that is changing people’s lives will be very challenging — so ensure you have passion for what you’re doing and an almost blind ambition to make it happen.”

4 • Don’t go crazy with funding

Chris’ wisdom regarding early rounds of funding is this: Look at the valuation and what you’re giving away in exchange for the money. Consider what you’ll use it for. Your potential investors will want to know this too. “I wouldn’t just try to get as much money as you possibly can, because if you go really crazy there, your valuation will get diluted. Early on, you want enough to get your business going and to accelerate things so you can focus on building the business versus paying the bills.”

What you’re looking to do is accelerate your business and have a strategy in place for how to achieve this. “By not having gobs of money, it will force you to be smart about how you spend that money. Hopefully, it makes you astute in how you spend, so you don’t waste anything. Don’t go on a crazy hiring spree and end up with too many people to handle,” he warns.

5 • Scalability or features first?

It’s that old axiom: don’t prematurely optimize or scale before you’re sure of what you’re dealing with. Chris agrees. “Absolutely features first,” he says. “Think a little about scaling, but you need to make sure your business is actually going to work before you worry about scalability.” He explains that for all startups, once you get traction and good traffic, scaling problems are inevitable.

“Don’t prematurely scale.”

“[However] you don’t want to be spending your time building some super scalable, massively distributed, fancy database before you even have a working product that you’ve proved is good for customers. Definitely go for features first. Narrow in on what your product’s going to be.”

6 • Don’t release something that’s half-baked

When you’re deciding the best time to launch a first product, don’t wait too long — but keep in mind the more functional and solid your design, the greater your initial feedback will be. “I wouldn’t put something out that’s half-baked. It needs to be fully functional. It needs to provide a solution to a problem. And it needs to do so in a nice-looking package, especially when it comes to mobile products,” declares Chris.

Considering the mobile space is hyper-competitive, it can be difficult even getting people to discover your product. “The app stores are so full of products that it’s extremely hard to get into the Top 10 or anywhere that a customer will randomly stumble upon it. So pay a lot of attention to the design and have a really great product that’s very high quality. Ensure people can quickly grasp what you’re offering and how it’s a solution to a problem.” He finishes with, “Don’t wait too long. If you wait until you’re ready, you’ll never be ready.”

7 • When hiring, use the “beer test”

A few words on hiring. “Early recruits are super important because these are the people who will shape your company culture. More important than their skills, make sure they fit. Use the beer test: you want that person to be somebody you’re comfortable sitting next to every day, someone you could get a beer with after work. They needn’t be your best friend, but an ability to have a productive argument is key.”

8 • Stick with one or two key metrics

Another important question to ask in startup land is, “What does success look like for my business?” To answer this, it’s crucial to define the metrics that will push your company forward and allow you to demonstrate traction. “Define those metrics so they’re relatively simple and understandable to everyone in the company. Make sure everyone gets them and how their role contributes to dialing up those metrics,” offers Chris. Ideally, stick with no more than two to three metrics. HotelTonight originally focused on room nights as a measure of transaction velocity, which is critical to marketplace businesses. As they have now achieved liquidity, the focus is on unit economics (profitability per transaction), to provide resources to invest back into growth and building great customer experiences.

Hopefully, you found Chris’ advice helpful in your own startup or venture-in-the-making. Likewise, if you have any counsel to offer on the topic, please share your ideas in the comments below. We’d love to hear your input.

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