What I learnt while setting up a business right after graduating…
After graduating from an MSc in strategic marketing from Imperial College, I took the decision to start my own company with the ambition to disrupt the car wash industry with my partner Hugo. Squeek ignited a revolution in its sector, simplifying the way people consume car wash and introducing a never experienced level of convenience. How did it work?
Squeek was an on-demand, waterless and eco-friendly car wash mobile application, aiming at making simple for car owners to get their car cleaned where they were parked within 60 min, using only one cup of water. (more on Squeek here)
Sounds cool, init? 7 months later, we were closing the company having only washed 100 cars. Here is why I believe we failed:
1. Talk to me baby!
When you have an idea, take it out there! We often mistakingly think we’re better off operating in stealth mode, that the surprise effect will be amplified in the eye of our friends/family/competitors or that someone will steal our idea… That’s what I believed, I was wrong!
Lesson n°1: The more you talk to people about your idea, the more you’ll iterate, the better it’ll become…
But remember…
Lesson n°2: “Ideas are cheap, execution is everything” — Chris Sacca, investor in Twitter and Uber
2. You don’t need to put yourself at risk to prove your idea is worth pursuing
Launching a startup project doesn’t necessarily imply to quit your job, break your piggy bank, and lock yourself in a garage 24/7. 75% (or so) of the business fail so there is a high probability that yours will… at least ours did! Just keep in mind there is no such thing as zero risks. However, you can reduce to a minimum your probability of failure as well as your exposure to it.
Lesson n°3: Entrepreneurship requires time, energy and money. Make sure you use those resources wisely!
3. Identify true market opportunity…
Having little to no knowledge of the entrepreneurial world, we got inspired by the latest topic on the rise of on-demand businesses. Money was rolling in for Uber, Deliveroo, Take it easy, etc… We thought: “we are smart, we have an idea, how can we not get a piece of this cake?”
The reality was much less sexy… In the relentless world of the on-demand economy, people purposely raise money to achieve hegemony. Irrespectively of short-term profitability, they bet on future economies of scale to achieve hypothetical break-even. What people tend to forget is that it doesn’t always work out and sometimes they learn it the hard way … (take the example of Take it easy).
Lesson n°4: Learn how to identify a true market opportunity: total addressable market (TAM)? estimated served addressable market? barriers to entry? etc.
Lesson n°5: (from the Take it easy case): Technology based services might have introduced a new paradigm: winner takes it all…
Notes: We knew from the beginning that our business model would require a big amount of cash. Along the way, we realised VC money was slowly drying up for capital intensive business services. The answer was clear: if we wanted to raise, we needed to come up with astonishing financial projections!
4. Go MVP!!
If I had to reach to the same point where we left off the business today, it would take me less than a month! After losing weeks on designing an app that wasn’t even needed along with other time-consuming tasks, we got to discover the concept of the Minimum Viable Product (MVP). Then there was light…
Lesson n°6: Focus on key features to prove your business model viability/profitability, not the fancy outfit or the shiny logo…
All we needed to test our idea was a website with a booking system, cleaning products and a bit of elbow grease… HUSTLE TIME!!
“ If you are not embarrassed by the first version of your product, you’ve launched too late “— Reid Hoffman, founder of LinkedIn
5. Engage, engage, engage
It took us 2 months to get down in the streets and start washing some cars while this should have been our starting point. Once we understood this, we got the hell out of data (plus a considerable motivational boost) from our customers, enabling us to make financial projection!
Lesson n°7: Don’t be shy and engage to try and understand how your customers function! (typeform’s surveys are a good way to drive actionable data in a fancy way)
“We must learn what customers really want, not what they say they want or what we think they should want “ — Eric Ries, author of the lean startup
6. Team = complementarity not similarity
My partner and I had similar backgrounds, we both graduated from the same MSc at Imperial. We quickly understood this would be a major problem if we wanted to grow as ambitioned. In this context, we desperately needed a tech guy in our founding team (no need to mention that this applies for any projects relying on technology to run the business). We eventually ended up finding our gem under the person of Kelvin, this guy was absolute gold. He knew how to code, design, he was a physics student at Imperial and had already written a 350 pages book about photography by age 20.
Lesson n°8: Surround yourself with complimentary profile who balance your skillset and if not, develop the skills needed to conduct your MVP
(Building a strong founding team with complimentary profile will more often than not be the reason investors funds you btw)
It is worth mentioning that Hugo and I developed immensely valuable skills along the way :)
7. Make noise, a lot!*
Making noise as to signalling yourself to your environment* I got shy in the first place, fearing for my street cred’ to go down… That was a mistake, people want to hear about your stories and preferably the one where things are going south on you. I guess that’s why reality shows perform so well…
Lesson n°9: Don’t be afraid of communicating around your story even though it’s not perfect. Actually, take it a step further and document your day to day adventures!
Documenting your journey versus creating an image of yourself is the difference between saying “You should…” versus “my intuition says…” — Gary Vaynerchuck
Vlog will do it best:
8. Network.
Calling your friend or a friend of your friend to get insights on how to raise is good. Dropping into a meet-up by yourself on a Monday night to meet VCs requires courage.
I guess I didn’t have courage…
Lesson n°10: Whether you’re about to raise, are fishing for talent or just willing to make yourself more visible, networking is the #1 key to success. No questions asked!
9. Iterate
Lessons n°11: Build → Mesure → Learn → Repeat
10. Fund raising
Raising funds is cool but not having to is cooler. Along the process, we understood that VCs are looking for profitability coupled with tangible data supporting your projection.
“You know what’s a disruptive idea? Building an actual business that has investors coming to you, not you chasing them”- Gary Vaynerchuck, CEO Vaynermedia
Our MVP allowed us to collect this much-vaunted data. After running models, we realised profitability wasn’t meeting our expectations. Three main factors were impacting our results negatively:
- Low willingness to pay
- Low frequency of utilisation
- High operating costs
Projections were looking bad and so was the future of Squeek…
11. The end
Quickly after the end of MVP, we both decided to call Squeek a quit and struck off the company.
When we started working on this project in 2015, we shared a passion for simplifying the way people consume car wash. It’s been a great journey, and we’re proud of this impact and grateful to the community that helped make it possible.
Thank you to everyone who helped bring Squeek to life, whether by spreading the word, letting us know what you liked (and didn’t like), or simply using the product. You taught us so much, and we’re deeply grateful.
On to the next one!
Tancrede, Co-founder & CEO
