Archive for November, 2010

Shelving My Startup

November 29th, 2010

Well, I did it. I’ve put my startup on the shelf. Why? The running out of time and money statement applies here combined with the fact that I came to discover it wasn’t solving the problem that I set out to resolve.

Tshirts4Hire began as a way for people to make money (enough to make a living) being creative and promoting things that they liked. The secondary problem/solution that was to finance the first problem/solution was providing companies an effective form of advertising. I came to define “effective” as what could be tracked and resulted in a sale/conversion for the business.

Unfortunately, I found through a couple of tests that it wasn’t the silver bullet for marketing. It drove some web traffic but didn’t result in people pulling out their wallets. The amount of traffic also wasn’t enough to charge the company to make it worth it for either the company or iMarketer. It may work better with certain industries, events, or iMarketers; however I’ve run out of time and money to find where it works the best.

This is why I’m putting Tshirts4Hire in cryostasis with the half-hearted belief that I’ll revive it to finish testing and developing once I have some extra money. However, I also know that the extra money scenario is unlikely and that I am basically killing my baby.

While killing my baby is a gruesome visual it probably captures the anguish and desperation that the biblical figure Abraham struggled with when asked to kill his own son. A startup becomes something you create and nurture. Pouring time and money into it, guiding it through challenges, learning together how to manage it and help it walk, and looking forward with such hope and optimism of how it will make the world a better place. Only to realize that it doesn’t work like you hoped.

Since it is my first startup it became a surprising emotional struggle for me. This felt so right to start, a life changing revelation. I had the chance to shine and be free. And now to admit that I was wrong or that I can’t do it; that I’m not good enough. It becomes a dangerous self-talk spiral that either causes despair or entrenchment. 

I found myself starting to act a little like a desperate, compulsive gambler imagining that I just needed a little bit more time until I hit the jackpot then everything would change. I would remind myself how much I’d already into this and that I’m not a quitter. Fortunately I countered by reasoning with myself that those are sunk costs that shouldn’t influence an objective decision. What does the data say?

The data is inconclusive and limited. It has been promising in some aspects (web traffic and good conversion rates for non-financial calls to action) but hasn’t validated the concept (business can put 1 dollar into our machine and get 3 dollars out). My gut says it can work but it will take a lot more resources both people and money, but without solid data I can’t ask my family to risk more.

It still hurts to think about. It has taken time to adjust my day-to-day life since so much it has revolved around making the startup successful. I’ve also stopped hanging around other entrepreneurs temporarily because I feel like I need a reason to be there. A few have offered an opportunity to join their startups which I’m extremely grateful for the chance but unfortunately the equity payment doesn’t meet my needs right now. I need an income to provide for my family and payoff some debt. So now Plan B, answer questions both in the short-term of “Now what?” and in the long-term “What now?”

The long-term shapes the short-term. I’ve found that my wife is a tad risk adverse which means I need something that is secure but still provides me autonomy, a chance to create, and to be around smart people. An entrepreneur research professor seems  to fit that description.

Broadly I’ll focus my research on how to create a society that has no poor, where everyone’s needs and wants are met financially, where people have careers doing what they love. My theory is that facilitating successful startups will result in a move towards that ideal.

If people don’t want to start their own business then I want to be able to help them know which company or roles they’ll be happiest in. I want to know why and how people decide to start their own business. Here are a few additional questions I hope to be able to answer (feel free to answer them and save me the trouble):

  • Is there a difference in when people decided to build something scalable as opposed to a small business?
  • How do people decide what to do? Is there a best way to decide or generate ideas?
  • Which comes first the team or the idea? How does changing either of those affect the other? How do you decide who to bring on? Is there a predictor of group fit and does better fit mean more successful? Is there an optimal team composition (skill set or roles)?
  • Is there a set of best practices to beginning a startup? Are they teachable skills? How is the best way to teach people to do startups? Can it be scaled globally?
  • What makes or defines startup success? What are barriers to a successful start-up and how can the barriers be overcome? Is there an ideal capital infusion engine that can facilitate the end goal?

CupAd – Your Brand In Their Hand

November 22nd, 2010

The YouTube video about coffee cup advertising was made by the Light Brothers, Josh and Caleb. Two guys I’ve had the pleasure to get to know over the past several months. Their marketing company, CupAd, is a great example of taking an established practice, such as outdoor advertising or branded paper cups, and combining it with another concept, like an ad network, to create a whole new way of advertising that adds value to new group.

They provide free paper cups to local coffee shops. The cups are double walled so it saves on sleeves as well. This greatly reduces the overhead to the shop owners. In exchange CupAd is allowed to put advertising on the cups. Advertising which is seen by at least 6 other people and creatively gives the advertiser about 37 minutes of brand exposure as they finish their beverage. CupAd also allows advertisers to target geographically a particular demographic and then track the results via QR codes and text messaging codes.

 This business model allows CupAd to have the advertiser to pay for the production of the cups and provide them with a little profit. Not a bad gig and just wait until they build out their self-service website. Nothing like making money while you sleep.  

 

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