Killing my idea - A Lesson in Failing Fast.

The counterintuitive reality of ideas - They are easy to talk about, and extraordinarily hard to bring to life. However once created, the toughest challenge of all is to kill them.

Think Frankenstien's monster to the man himself... except less chasing around Europe.

Reflecting on my notes from the past 9 months. The ~3 meetings per week with founders, operators and potential customers. The hours to ideate, build and iterate. Alongside all the other responsibilities that come with running a startup.

One thing became decisively clear.

The solution I was building sounded great in theory, but in practice… it was not a sustainable business.

Typically stories like these would be buried. Nobody outwardly likes to put up their hand and say “Hey Look, this failed”. However, I feel like this deserves to be written about. Not only does this contain some pivotal lessons that I believe every first-time founder could learn from. It’s also a chance to help others who may have the same idea in the future.

Because I never had the chance to find anyone who had tried this.

This is the story of an idea that I tested with a small network, launched to everyone reading here, and then dealt with a maelstrom of problems until finally - the decision was made to kill the idea entirely.

So, where do we begin?

The original thesis behind Repeatable

“Access to expert-led courses, resources and connection. Creating dedicated resources for APAC founders & Revenue Teams”.

The main thesis was to create a central layer where founders could access the information required, learn what to do, and have people on hand to help them do the doing.

Breaking that down into;

1. Courses: An easy way to access guidance and “how to’s” on particular topics
2. Resources: Think about all the strategy decks that have been used once, and never saw the light of day again. Wouldn’t that be handy for another startup?
3. Connection: You can connect with experts to close the loop on learning, with a community in the centre.

The basics of the business model. How do you combine everything in one place?

Before we go any further, I’ll my definition of an “Expert”

1. They have been or are still in a high-growth startup environment
2. They have worked in Revenue Teams (Sales, Marketing, Customer Success, Growth)
3. They have awesome stories to tell that could help others

The analogy I used to think about experts was simple. At university, you have tutorials and lectures. However, the lecturer never takes the tutorial (it's generally an underpaid grad student), but is generally the most experienced on the topic - can you incentivise them to provide the tutorials?

Applying this to a business context I was asking the question of whether we could build a platform for learning, community and connection that minimises the expense of consultants or early-stage hires that have a high failure rate (i.e. Revenue focussed teams) by putting everything into one place.

This theory helped me and my initial co-founder get my first paying customers and trial it out behind closed doors for a couple of months, before launching to the public - under the pretence of getting market feedback outside of people from within my network.

That launch provided all of the core lessons we are about to go through today.

1. Don’t try and push different business models together

Sometimes you look at an idea and go “Why don’t they fit together”. My thesis required just that - an amalgamation of a few business models in order to make it operate.

The main business models I was “pushing together” were:

• Consulting / Fractional: Service-based, projects typically last 3-6 months, with semi-recurring revenue
• Courses: Productised or Service Based, Typically 1-month, non-recurring revenue
• Recruitment / Referral: Productised or Service Based, Ad Hoc, recurring revenue (if you increase your book size)

Once we break down the various parts - you can begin to see the points of failure. To create a successful business, and especially being bootstrapped - you need to have a great business model.

Great in this context does not constitute "1 + 1 = 2".

A key problem encountered along the way was the cognitive burden on both user(s) trying to explain the model, and experts trying to understand how they could extract value to sustain their own business.

On the user side, it turned out the use case users typically wanted when coming on board was to work with ONE particular expert, not multiple. Other users also wanted to have access to training courses for their team, not for themselves. I wasn't really solving a problem for them. They wanted to pay a one off fee or simple structure.

For experts, the difference between a consulting fee or their salary vs. giving away help for less time just didn't make sense. You needed to make them an expert in others eyes... more on this later. They wanted to be paid a one off fee and not have random hours booked.

As for courses.... there are so many of them at the moment and others which are more established that it made it extremely difficult to crack the market without creating my own.

Lesson(s) Learnt:

• Pushing multiple business models together is an uphill battle that requires a team and/or strong foundations already built. Start with one, then expand out.
• Keep your pricing & packaging simple to reduce the cognitive burden on the user(s)
• There's a tug of war between education vs. hiring someone - personally, I think in this region we'd rather hire than learn to reduce cognitive burden... this is probably another post.

2. Munger was right, it's always an incentives problem

Compounding on the fact that there were multiple business models at play - the model I created, created an incentives nightmare.

My initial hypothesis was to create a payout model that incentivised experts to run courses, and a low-cost method for startups to book out their time.

The thesis was that these experts would be asked to provide free help, so why not create an incentive that both showcased their knowledge, whilst allowing them to be booked for hourly sessions? Getting paid for their time, whilst also helping out startups that couldn’t justify the headcount of a consultant or advisor.

The premise was that startups pay a subscription, access the content, go to events and are free to converse with experts whenever they need to. There was both an incentive on the customer side, getting access to the knowledge, and on the expert side - both monetary and being the expert.

Now, as it turns out from an MVP - that incentive wasn’t enough for experts, wasn’t attractive for startup founders and required Repeatable to capture a large share of the market.

For example, after conversations with 26 different experts and ~11 others interested in the business model.

On the expert side, the main concerns were;

1. Why shouldn’t I just spin up a course myself and charge more.
2. I work full-time, this is too much effort.
3. I already partner with a VC firm / others and can get good consulting revenue from them

On the customer side (startups), the concerns were;

1. Learning is great, but I would rather hire someone to do the job
2. I want something my full team can have access too
3. I already have access to 100’s of free communities and my VC’s platform, do I need another place to speak with founders?

A lot of problems appeared on both sides of the network. A large majority of experts didn’t see the value at that price point, and founders were more interested in hiring to get a job done than learning to get it done.

This isn’t to say there were not sparks of value.

There was plenty of support from fractional executives for an easier method of winning business, and for startups to access a vetted network of people. A potential recruitment platform for fractional executives.

However, this wasn't really a problem I wanted to solve by myself. More on this later.

Lesson(s) Learnt:

• Map out the incentives & disincentives for your user(s) - make sure the pro’s outweigh the con’s.
• Tapping into the expertise economy is difficult without proving you have distribution for their expertise.
• It's been written multiple times - marketplaces are damn hard.

3. The Reverse Marketplace Phenomenon

For anyone building a marketplace or thinking about it - the go-to guide is 'The Cold Start Problem' by Andrew Chen.

One key concept that the book mentions is all marketplaces have a “Hard” and “Soft” side. If enough of the hard side is attracted to your offer, the soft will follow. You either charge the soft side to access, take a clip of the ticket from the hard side, or do both. The later being the holy grail.

For example, think of Airbnb. They are connecting people, with places to stay in. The hard side is the houses; the more quality houses they attract, the more people (soft side) that are likely to use the app. Each house brings more users, more users bring more houses.

What you are trying to build is a flywheel effect that will decrease acquisition costs over time. Powering your network effect.

I originally hypothesised that onboarding high-quality experts would be the catalyst to getting interest from Startups. Hard Side = Experts, Soft Side = Startups (who would be charged). More experts meant more courses, more courses meant more users.

The reality is, that there’s an oversupply of “experts” looking to help or work with startups, and an undersupply of funded startups that can justify the expense here on a longer-term basis.

Think of all the mentors that help at accelerators even if they are unpaid. This oversupply, mixed with a lower TAM of funded startups who need viable help, leads to the soft side having purchasing power. If they can either pay someone or get free help for an hour - which would they be more incentivised to consume?

A lesson on economics and market dynamics is if you have a party with purchasing power and an oversupply of people willing to help - the supply side will decrease in value. As the value decreases, the odds of creating a successful business decrease. Unless supply is steady.

So, the economics of this marketplace got me.

Lessons Learnt:

• If you ever build a marketplace, focus on the incentives. At the end of the day, you want to be able to support a large amount of transactions that are frequently occurring… not a small amount that are ad hoc.
• Recognise that a great business will always be built off increasing margins where the effort to produce decreases over time. The supply & demand effect can destabilise a business.

4. I failed to recognise my biggest competitor(s)

Exploring the reverse marketplace effect, we introduced the idea that supply outstrips demand in this area. Look across LinkedIn, particularly in Australia and you will see a bunch of people who are part of accelerators or VC network groups of “mentors”.

Whether Blackbird Giants, Startmate Mentors, Airtree Explorers, Techstars Mentors or accelerators. What I failed to realise at the start of the journey was that my main competitor wasn’t just other consultants or advisors - it was VC firms and the platforms that have been built.

As a side note: I believe the programs are a net positive for the industry. Some I have been, and would be happy to be a part of. This is not a post to say "this is bad", its to highlight an assumption I never thought about before for other expert-marketplaces.

That being said, these platforms create an incentive of “free help” which has its limitations. Creating an agency problem. The provider of this help will never bear the downside of their advice, but gain all the upside for doing so when free.

Speak with any founder. They will most likely tell you that free advice is abundant, great help you have to pay for.

Then you ask them - Would you rather leverage this free centre of help to find the best advisor, mentor, agency or whatever else… or would you rather pay for it but know it’s completely vetted?

Ask the same founder again, and more often than not they will hustle for free help. It's in the very nature of startups.

In terms of the model which I originally set out to build, these platforms already provide:

• A method to attract top-of-funnel startups via funding
• An easy way to access experts and ask tough questions via their community
• A vetted network of experts
• Training and courses provided (this is optional, but starting to get rolled out more)

The network effect created by VCs and accelerators has the greatest pull mechanism to drive a community and repeat utilisation, whilst providing a sustainable business model for their main service offering.

Does this mean the network effect here can never be beaten? No.

However, can someone bootstrap a business that can outcompete this network effect? Same answer.

Lessons Learnt:

• You will never understand your biggest competitors until you launch.
• Distribution is a superpower - the real competitor(s) had better distribution and incentives to maintain the network.
• Trying to service hustlers (founders) almost always leads to unsustainable economics... unless you're a SaaS product.

5. Your greatest resource in the first 6-12 months is energy… or funding

You can blame market dynamics all you like. However when you start a company, the reality you accept is that you’re ultimately the captain of that ship - your faults will contribute to it’s success or failure.

Candidly, I started this journey with a co-founder who exited within the first 3 months (on good terms and for good reasons). However, rather than calling it a day and simply moving onto my next thing, I wanted to see if I could make this mission a success.

You can see why countless essays and posts are written about the problems of being a solo founder, and the likelihood of success vs. a founding team.

The reality is, You only have 24 hours in a day and energy/output to match whatever you can put in. With more members, you can double or triple that output... unless its an AI bot.

However, I'm a human that was both working “on” the business, “in” the business and "managing" the business. Everything from the product vision to speaking with both sides of the network and bringing in money. It was on my shoulders.

Without capital to outsource components or someone to take on duties - my bandwidth gradually depleted. With less bandwidth comes burnout. With burnout comes less likelihood you will try pivot it for the 9th time.

Realistically, the only way to get out of this gap was to raise capital or bring on more team members. Both require capital or a co-founder to work on this project with.

Lesson(s) Learnt:

• The more people who work on a problem, the more likely it is to succeed… get a co-founder.
• Your energy is your greatest resource, context switching is the killer. You can only reduce this burden by slimming your offering, hiring someone or having a cofounder to take on other parts of the business. See point above.
• Burnout is real. Take a break. Nobody works 100 hours a week… unless your definition of work includes sleep.
• Most people don’t quit their job and start a business, they are working on it for at least 6-12 months before launching their project. Think about this before you start. Play the long game.

So… what’s next?

There are so many lessons to take away from this.

This experience has given me first hand experience and empathy for any founder out there building their business, and the countless problems that come with trying to do so.

I have been able to work with some amazing founders, meet "cool people doing cool shit at cool companies" and learnt 3 things in 5 years. I want to thank everyone who has helped me through this journey, whether with their help, advice or introductions.

That being said - after speaking with many mentors, other's and "finding the gravestones of other startups" like one other founder told me to do. I have decided to kill this idea. Moving on an figuring out what is next.

It's time to fail fast and move on from this idea.

Making sure it doesn't end up like Frankenstein.