I’m not sure what the exact statistic is, but it’s well known that the number one reason that startups fail is due to internal issues within the team. In fact, I think it’s something like 70% of startups fail due to this reason. A business partnership is a very intimate relationship. People say it’s a marriage of sorts. Having never been married myself, I can’t fully appreciate the comparison but I’m sure it’s pretty accurate.
When you start a business with someone, it’s a pretty serious commitment. For Leo and I, we both left behind our careers behind to found Prevyou more than 6-months ago. Along the journey, we’ve made a number of pretty serious personal sacrifices. We’ve been living on a tiny salary since then and let’s just say we’re not going to be in the financial position to put a deposit on a house anytime soon.
We’ve also sacrificed a lot of time away from family and friends, which is pretty hard to measure in value terms. On top of that both of us had long term girlfriends when we founded Prevyou and now those relationships have ended. It’s hard to say that our business endeavours were the sole cause of that, but it certainly added an extra strain.
Needless to say, we’ve both got a lot riding on the success of Prevyou. The fact that we share a one-bedroom flat and rotate off the couch every couple of weeks is a constant reminder that we’ve got a long way to go on this journey! It’s also become abundantly clear that our ability to work together effectively as a team, is certainly the most important factor for the success or failure of this venture.
Honestly, I think we make a really good team. We’ve got a really strong personal relationship and share a similar sense of humour. As business partners, I feel Leo’s creative and dynamic style balances out my more analytical and strategic approach. We’ve also worked together previously on a carpooling startup that we found while we were both still studying.
That being said, we know that our working relationship is far from perfect and it’s something we need to continue to work on. This week was a pretty humbling week for myself as I became aware of some serious issues with the way I’m handling our working relationship. There were some tough times, some very honest chats and then finally another significant breakthrough with our service offering.
A wise person once told me that these moments of self-realisation are gifts because they offer you a great chance to better yourself. That’s something I’ve been trying to remind myself at the end of a ‘challenging’ week for Prevyou.
Two weeks ago, in my post about getting out the way, I briefly addressed this teamwork issue. The result of that realisation was that we needed to stop trying to share every aspect of the business and delegate some responsibility between us. We did that and the results were positive. However, half way through the week an old and persistent issue reared it’s head again and caused some serious concerns.
Let me describe the situation for you. It’s late on Wednesday afternoon. We’ve just got off the phone with Riley (our program manager), who’s just talked us away from another knee-jerk pivot in strategy. I’m sitting in a room with Leo feeling completely dejected because I know I’m the cause of this problem and it’s certainly not the first time it’s happened. Riley’s advice to us was to take the night off and have a frank discussion about the way we work together and make decisions.
The two hours leading up to this call involved me trying to persuade Leo that we needed to adjust our strategy. Throughout the week I’d received some negative feedback from a couple of Startups that had led me to think that the whole concept was flawed. Rather than trying to adjust my pitch to them or look for a different market I leapt to the decision that our current concept was doomed and needed to change. All these decisions I’d made by myself, without talking with Leo.
It was only after this phone call that I realised what I was doing. I had essentially come to all these conclusions by myself and then tried to persuade Leo around to my train of thought, rather than having a collaborative discussion with him. The sobering point was that this wasn’t the first time I’d done this and the result of this was that we’d spent months chasing our tails following different paths.
An honest chat
Leo is seriously one of the nicest people you’re ever likely to meet. In five years of knowing him, I can’t recall ever seeing him angry. I think at times I’ve taken advantage of his laid back attitude to push my own opinions across the line. It’s clear to us now that if we’ve going to become a high-performing team we will need to reach decisions in a collaborative way.
My key realisation is that there is a time for persuasion and a time for collaboration. In my ‘sales-type’ role for Prevyou, I’m constantly trying to persuade people to join our cause. It appears that I’ve fallen into this persuasive habit when we’re having team discussions. Rather than openly discussing a particular problem or issue, I’ve been trying to bring Leo around to my way of thinking. This is certainly not the way to make mutually agreeable decisions.
The other crucial issue that we discussed is the fact that we need to be extremely honest with one another about the direction of Prevyou. On reflection, what caused this issue was the mounting pressure I was feeling about our progress. I felt there was an issue with how we were structuring our service but rather than discuss those with Leo I decided to take it upon myself to come up with a solution. The result of this is that rather than discussing a particular issue, I was trying to pitch a solution to Leo before he’d even had time to think about the problem. Again, another poor example of teamwork.
Don’t worry, the chat went really well and we hugged it out after! I know that it’s very easy to say (and write) about these things. The most important thing will be actually putting them into action!
What’s changed for us
The next day, we had a chat about the real issue underlying the problem. The problem I was having pitching this concept to startups was the fact that it was free for them to participate. The fact that it was free for startups led them to one of two conclusions:
- The work that the students are doing has no value;
- The work is valuable so I want to pay someone for doing it.
The problem I was facing pitching this was that there was no way to argue against one point without leading them to the other conclusion. The other issue for us is that we want the work the students are doing to have real value. That’s our key differentiator as a service. The fact that we’re teaching skills that are valued by startups. We don’t want to work with startups that don’t value the work being produced. These startups won’t take the necessary time to create a meaningful project or give valuable feedback once it’s produced.
The difficulty that we were facing is about where the money from the startups would go? We didn’t feel comfortable about taking the money ourselves, as we felt that would put us under increased pressure to serve the startups needs rather than providing the best possible learning experience for the students.
We also didn’t think that giving the money to the students was a good idea. We understand that many of the students who’d want to participate in our programs would be doing so to broaden their skillset. This means they won’t require any existing level of expertise before starting. This is a crucial element of our service as we want our programs to be teaching students new skills and to be run inclusively. We know we can teach students the skills to be effective after a 5-week course, however if they were to be paid directly for applying those skills straight away it would put an unfair amount of pressure on them to perform.
A different type of collaboration
After pitching our concept to the H2 accelerator program on Thursday, I had the chance to catch up with Tom from InsideSherpa. Tom’s a former lawyer and founded InsideSherpa as way to help students with the transition from Uni to the workforce. InsideSherpa is a database of working professional that mentor University students about career related issues such as writing a proper resume, job-interview tips and general career advice.
Catching up with Tom was really refreshing. It’s clear that his motivation comes from a desire to help students. Tom’s vision for InsideSherpa is to help address the lack of diversity at large firms by giving more students the connections they need to shape their career decisions.
An interesting point that Tom pointed out during our chat was that the majority of their mentors donate the money they receive from students to a number of partner charities that they work with. This makes perfect sense as my experience with mentoring students at NAB was that it was a really rewarding experience in its own right. If the result of that experience was that some money also was donated to a worthy cause, than it would be even more meaningful.
Tom’s advice was to allow the startups to make a donation on the student’s behalf to a charity of their choosing. This would mean that the students would know their work has real value, we’d only attract serious startups and most importantly both groups could help further a worthy community cause. This highlight the value of being open to collaborating with other companies in the same space. Tom has clearly thought about many of the same issues as us before, which means the discussions we have can be very insightful.
We’ve agreed to catch up again the following week to talk about other ways that InsideSherpa and Prevyou could work together.
Putting theory into practice
Learning from what Leo and I discussed just the night before, I knew I had to approach our next conversation in a much different way. I was of the impression that the charity payment was a the solution to our problem. But I needed to collaborate with Leo rather than trying to convince him of that.
This is how the meeting went:
- Firstly, I laid out what I believe to be the existing problems with the option where the startups don’t pay.
- We then discussed those issues to agree if they were really that important.
- After we’d decided that they were important, we then discussed any other ways we could think of addressing them.
- With no clear solution coming out of that, I then walked Leo through the charity option and what the perceived advantages of it were.
- The key difference was that rather than arguing a point, I was just outlining a plan.
- We then discussed how that would all work logistically and agreed that it was the best way to move forward.
Obviously the teamwork aspect is something that requires continuous development, however I feel that this was a step in the right direction.
A dose of nostalgia
On Tuesday I had the opportunity to speak with a class of students at UNSW who were enrolled in the Entrepreneurship and Innovation unit. This was a little surreal for me, as it was through a similar unit at UWA in 2012 that sparked my interest in starting a business one day. It was a really rewarding experience to connect with a group of young people who are also passionate about Entrepreneurship. Presenting also help reinforce some of the key lessons I’ve picked up along the way.
(The view from the back of the class)
The students in this unit are all going to be working on their own business ideas in groups throughout the semester. As part of this project, they’ve been asked to find a mentor who can chat with them each week and provide any assistance they need. I’ve been lucky enough to be invited to mentor two of the teams along with Leo. We think this will be a great opportunity for us to pass on some of the knowledge we’ve picked up, whilst also keeping ourselves accountable by practising what we preach!
The plan for next week
Admittedly, we both felt that the week could have gone better. Again, we refined our offering down to something that is now extremely simple and clear. Leo managed to convert 1 student, which is a little short of the goal of 10 but still a positive result. The traction side of our operations is difficult. As we’re marketing a completely new service, we’re experimenting with a lot of different approaches.
(One of our posters at UNSW)
It’s easy to get lost in all the details, with some many different options to explore. The key channels that we’re looking to test this week are:
- Content marketing: pushing out the free eBook that we created:
- Content marketing: developing a free online course that will help students find their own job opportunities called ‘Hustle yourself a job as a student’
- Lead magnets: offering some free resume templates on our website to build our email list.
- More Facebook ads: the one conversion came through a Facebook ad, so we’ll continue to with that channel;
I didn’t lock away any startups because we still weren’t sure about the payment situation. Now that we’ve decided on the charity donation option, we’ll be able to go back to those startups early next week and get our 10 onboard.
The goal that we’re both pushing towards now is to launch those 10 programs by the 10th of April. This would mean 40-50 students registered and ready to go by then. This is approximately 12 weeks before the end of the semester and will give us the necessary time to run these programs before exams start.
Finally, as we can see from our old friend TimeDoctor, it was a week spent mostly out of the office trying to sell to students. Next week the theme is all about focus. It’s time to knuckle down and start making some sales to prove this concept has legs.