CEO Idol

Every year I do an impossible challenge. It’s a thing. Okay so obviously the things I attempt are not impossible, because impossible is impossible! Right? It’s funny how often we use the word impossible in life not really meaning what we think it means.

impossibleImpossible. We say it but really, is it?

In previous attempts I have cycled solo from Steward Island to Cape Reinga. I told people and they laughed at me in my face, as I was a 100 and something KG fat guy who hadn’t done anything physical ever, and hadn’t ridden a bike since I was 13.  I dropped from 100+kg to a trimer 80ish on the way.

I’ve quit drinking for a year, quit watching sports. I’ve quit reading, listening and watching any form of news media.  I have started my own software startup. I have run 1,000km including 5 half marathons.  Again not bad for a recovering fat guy.I am pleased to confirm that I have succeeded in every challenge so far. See, not impossible.

I’ve mainly been alternating between quitting things and doing crazy physical things. I figure this way I gradually remove all the things that make my life worse, like bad news and smoking and do lots of good things for my body that make my life better, like running and cycling crazy distances.

This year I am adding a new category to my impossible challenges. To learn a new skill. I’m not talking about learning to do woodworking, or pottery, or hand-gliding. I have to learn a new skill and reach expert level. Well perhaps not expert, but generally nail it in some epic way.

This year my challenge is to learn to sing, in a band. Now, that alone sounds pretty doable. So to make it an impossible challenge, I need to learn how to sing (I am not a singer. Ask my kids) and get a paid gig singing in front of at least 100 people, for MONEY. And not get booed off. So not only do I have to learn to sing, but master a level so I am good enough that someone wants to pay me money and attract a crowd of 100 or more people. I have to overcome all my horrible fears and demonstrate my new skill publicly in front of a bunch of really critical people, basically not my family. Considering that any form of public speaking turns me into an incredible sweating twitching nervous wreck, singing is bound to give me a full nervous breakdown. I think I can probably get half decent enough at the signing bit. It’s the public gig part that is the impossible bit for me. But just as I felt a few years ago when I announced my bike ride of NZ to everyone, and quietly shat myself, I then overcame all my own doubts and I then went about doing it. One step at a time. Instead of focussing on what you have to do at the end, focus on each step that will get you there. One at a time.

That’s the bit I think that makes people think things are impossible. Self doubt. When you stop saying “I can’t” and then start saying “I’ll give it a go” you will find out there is a whole lot of things you can do. Amaze yourself at how impossible you are.

So I have the most part of a year to get a paid gig and nail this. In the meantime, DO NOT ask me to sing a song for you. I might punch you in the face. I am terrified of this challenge, and I need to slay some demons first before I can even consider humming a tune. But I will invite you along to my gig, if you are happy to pay ;-)

 

 

Moxie thoughts – UFB

Tonight was another fantastic Moxie session, thanks to Hayden Glass for organising these.  Tonight we were talking about the UFB rollout in New Zealand and what this means to us all, what opportunities it creates, and the value it brings.  Well that’s what I thought we were talking about.  I tend to absorb the discussion at the Moxie Sessions, then post-process it a lot.  Mulling over the conversations of the evening.  I am a little bit slow.  But here are some thoughts to share with the group and anyone else who is interested.

Here is what I think about UFB and the opportunities it creates for NZ, other than giving us faster Netflix, albeit illegally.

UFB is infrastructure.  It will take us years to roll it out to the majority of NZ’ers.  When we do it will be a great asset for us to use and abuse on porn.  Unless we find something else to do with bigger pipes to the home and business in NZ.  Consuming video, be it Apple TV, Netflix or Hulu (or Sky TV should they join this Internet phenomenon thing), is the obvious app for UFB.  It is the chunkiest content or data we consume today.  But consuming more of this via UFB just means we need to import more data from content producers offshore.  This doesn’t help NZ thrive, at worst it means we spend more time at home in front of screens lining US content producers pockets.  UFB will give us amazing infrastructure, and we will be the envy of the rest of the world.  This is the suggestion, not my assertion.  So how do we make the most of fiber, UFB and this advantage we will have over the rest of the world?

We need to get in the business of content generation.  New Zealand needs to export digital content to the world, or technology that helps generate and the consumption of digital content. This is a great opportunity for NZ, to do really cool shit with data.  Or we could wait until we can legally get Netflix and Hulu here and just consume.

10 years ago YouTube didn’t exist.  Neither did Twitter, and a lot of other tech we take for granted today.  YouTube was a couple of dudes.  So was Twitter.  They had some infrastructure and an idea and they built some stuff.  They happened to be in the US.  What if the next killer data app was invented in NZ.  I use the “Invent” word as this is something we Kiwis think we are good at. Inventing.  What if we invented a teleporter?  That sounds like it will need a lot of data, to send a whole person across space.  Might need fiber for that.  What about the next raft of Xeros, Vends and other software apps.  Sure you don’t need fiber for these, but to encourage every SMB to move their office infrastructure to the cloud. Fiber helps with keeping this fast.

In short, I think we need to get in the business of content generation and export it to the world. Content isn’t Shortland Street episodes either, but it could be.  It is apps, video, entertainment, and devices (yes hardware) that leverage off of really fast connections.  Holographic video conferencing.  A better Skype. Live reality TV streamed from your Google Glass glasses. Whatever.  We need to get in the business of exporting more bits to the world.  UFB has to help give us a competitive advantage here. Let’s get a bunch of big thinking ideas people together, give them access to capital and let them invent the future tech that will be in every home in 5 years time.  That’s what UFB enables us to do.  Not watch Netflix.  Although that is a pretty good use too, and I would like that.  It is just a pretty lame outcome of the UFB project if that is all we do.

Just some random thoughts.

Keeping busy, aiming high, and taking names.

I am part way through a bunch of projects so it is probably time for an update as I have been quiet lately. For very good reason.

For those that don’t know, I do a crazy goal every year. So far I have stopped reading newspapers (online and the “offline” versions) and TV news media for a year. That was a few years ago and I haven’t resumed media consumption since. I cycled the length of New Zealand solo, from the bottom up. Uphill. Started a startup. Gone from watching 5+ hours of rugby a week to none. Did a year of not being a consumer. And some other weird but interesting challenges.

Last year I was a little late in starting, and at the beginning of August I kicked off a dry year. 12 months of no alcohol. 10 months in and I can report some interesting findings.

Firstly, wow! Is alcohol really a big part of our life and culture or what? You don’t really realise this until you step outside and look in. The simple gesture of sharing a drink with someone is the thing I miss the most, and it is really hard replacing the significance of this with some other social interaction. Mostly people expect you to have a beer with them after doing a deal, or completing a project, or hitting a milestone, and when you suggest an orange juice, there is that awkward “I’m sorry, I didn’t know you had a problem with drink” situation or are you some religious fundamentalist where you have to explain that it is a dry year just for the challenge, and no other real reason other than just because. Going to a party and watching everyone progressively turn into morons over the course of the evening is quite surreal, and highly amusing. I can’t rate this high enough for it’s entertainment value. Sometimes I miss being a moron.

So two months to go and not sure if I will resume my habit of a glass of pinot in the evening. Running has become my new wind down tool.

About that running. So this year’s goal is to run 1,000km. The 1kk it has been dubbed. Roughly 3km a day. 20 a week. I picked 1,000k’s as it is specific, measurable (with your iPhone or a GPS watch), achievable, realistic (anyone can run 3km, you just need to do it every day) and time-bound, 1 year to do it. That makes it a SMART goal. Or something. But yeah, like my goal from 4 years ago to ride NZ solo, it comes down to being able to do something really achievable (run 3km, ride a bike for 6 hours) and repeat it on a regular basis, like daily.

In the first month I wondered if I could ever run 5k’s without stopping or puking. Now I can run 15km without any pause. Crazy to think I went from desk jockey to serial runner so quick. I now can’t wait to get out for a run. I love it.

I am 39% through on my 1,000 and on track to complete it by 31 December.

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I do a couple of 5km runs during the week then do a big 15+km run on the weekend. This works the best. I tried running 3km every day, then 6km every second day, but have settled on my current regime and it means if I feel like it I can push for a 20km run on the weekend. A secondary goal for the year is to do a half marathon.

The other thing I am running is my startup Vend, my goal from 3 years ago to do a startup my way.  Well, not 100% my way, I am not inventing anything new here. But 100% how I want to do it, and so far I have learnt my approach is not conventional, well in New Zealand anyway.

Vend is going exceptionally well.

There are many ways to measure the success of Vend, depending on your point of view. We are not cashflow positive yet, which seems to be to some the only way to measure success. Obviously that’s the endgame. Same for Xero and other high growth companies. We have been cashflow positive twice! First time it lasted a day then we bought a new laptop. We were a handful of people then. Second time we hired 4 new people, and havent stopped hiring since. We are, as Rod so eloquently puts it, not going to swim to the side of the pool. I think of us as going from the “Medium” speed swim-lane to the “Fast” lane. We want to grow as quick as we can to capitalize on the opportunity we have to establish Vend as the #1 platform for bricks and mortar retailers globally.

We have been doubling, tripling, quadrupling the value of the company every year, supported by our customer and revenue growth. We are growing between 10% and 20% month on month.

We have won a bunch of awards. 2011 Innovator of the year, Xero add-on partner of the year, Best Workplace 2012 in the Small Business category, 2013 Hi-tech Exporter of the Year (under $5m), 2013 Best Service Product, and others. I am proud of every award my team has earned. It is great recognition that we are doing amazing things, and will continue to.

Our team has gone from 1, me in 2010 to 11 at the end of 2011, 40 today and heading for 140 people as soon as we can find them, in three countries as we roll out our teams to the US, Australia and Europe. If you are looking to be part of something big, get in touch.

When I started, I wondered what it would be like to have 10 people on board. Then 40. Culture is a big part of our success. We have fun, work hard, and are passionate about retailers. We have built an amazing team who all feel like they have always been on board. That tells me we are doing something right when your team feels like one big family. 140 people will be the next cultural challenge for us, something we are not attempting lightly.

 

We have raised money four times. $100k, $1m, $2m, and just the other week we closed a round for $8m meaning we have raised $11m of capital in 3 years. We have raised all of our capital outside of the US with a large chunk of it coming from NZ, but half of our investment coming from offshore from Germany and Australia. I have an amazing shareholder list including Sam Morgan and Rowan Simpson from Trade Me, Christoph Janz, Christopher and the Point 9 team, Paul and Matt founders of Seek, Craig Winkler from MYOB, David & Nicki Wilson, Brian Gaynor and the Milford team, Koz and Amnon and the Southgate crew, Josh, Lance, Sacha, Nina and Craig, Miki and each of the Vend team who are all shareholders too. All A listers and all see the same big picture we see. We are building the #1 platform for bricks and mortar retailers. They all know a think or two about building big things too.

Not that there are rules around how you build a startup, but we feel we are writing our own in a way. Everything from our focus on culture, how we have raised capital, our global approach, and our product strategy. We are aiming high and pulling the slingshot back as far as the team can pull it, and are launching into the stratosphere.

 

So that is my update. Exciting times. Super busy times!

I wouldn’t want it any other way.

Long Exposure Effects

You got an idea.

You have taken that idea through to a product or a service.

You are ready for customers.

Now what?

There is always an element of “Built it and they will come” in every startup founders thinking when they come to launch day, 10X if it is an Internet business because every potential customer just needs to click on a link to your site, and “kaching!”.  Of course this is completely delusional thought.  Even just getting a link in front of a potential customer is pretty hard.

Again, same caveat as before, all I can do is share what I did and hope that it was right and is good advice.  If not, well at least I got you to click on the link to my blog post.

Before I even had a working version of Vend I was looking for every piece of exposure I could find, any opportunity to tell the world about what I was doing.  I had a working(ish) prototype on my laptop and I sat and had coffee with anyone who would listen and look at what I was doing.  The list got pretty long.  In a way I was testing the market, making sure what I was building was actually needed and wanted.  Of couse a lot of people thought I was mental, and didn’t think I would even get Vend off the ground, and if I did, it would most likely burn.  My prototype was ugly and I was hopeless at demos.  I really wanted to show off an idea, with broken code and a good story.  I probably wasn’t doing myself any favours with my Adobe Fireworks skills.

But something was working, amongst all the people I spoke to, some were already telling others about this crazy/awesome/ludicrous (pick 2)  idea that I shared with them.  Even if they didn’t like it, they were telling people about me and Vend.  Simple word of mouth was spreading my idea, albeit slowly.  I was already starting to talk to future investors as an outcome which I talk about elsewhere, but how do you get the all important validation from CUSTOMERS, the real people wo will pay you money?

Ben Kepes was one of those early people I barraged over coffee and Skype and any other channel open to me, including airport lounges.  He liked the idea, and suggested I enter for the Cloud Connect Launch Pad, an event in the Valley.  All I needed was a pitch, and a video demo.  Easy, I can use iMovie!  I was working on something at the time to help me with explaining my grand vision, so I did a quick recut (yes, seriously in iMovie) and submitted it to the Cloud Connect LaunchPad just to see what happened.  I don’t know if it was the charm of my kiwi accent narration, or my awesome iMovie edit skills, but VendHQ (as it was back then) was selected as a semi-finalist.  Whoohoo, I had no idea what the Cloud Connect conference was, or where exactly Santa Clara was, but if things went my way I would be there on stage as a finalist pitching my idea.  All I needed was 18 bazillion people to vote for me online.

Webstock was rolling up the following month, and a couple of weeks before the voting ended for the Launch Pad event.  And so I spoke to as many people before, during and after webstock making sure everyone knew Vend was a semi-finalist.  The levels of interest in what I was doing were increased somewhat, what was this Cloud Connect thing and why is Vend a finalist?  My demo video was doing the rounds, where I extolled the virtues of Vend and what it could do.  Part vapourware, part good iMovie edits, but it was working.  I had two retailers introduced to me, as a result.  Someone knew someone opening a store who needed a POS, and so I was introduced via email at Webstock.

These two retailers became my first beta users, and are still big Vend fans.

As part of my video I waxed lyrical about how awesomely Vend integrated with Xero, which it didn’t at the time, but I was working on it!  Tony from the Xero API team got in touch and invited me over to Xero HQ.  We sat around the board room table, and they eyed me up looking very seriously.
“You can’t use our logo and tell people you integrate with Xero when you don’t” he told me sternly.  ”But tell me more about Vend and when can you get the integration ready?” he continued.  They thought Vend would be a smashing add-on.

VC’s were watching the video, and sending me emails to find out more.  Having something that people could watch and see what I was going on about for over a year made opening doors much easier.  Emails, Skypes, and phone calls.

Vend was not picked as a grand finalist, but just being a semi-finalist gave us exposure, our first two customers, and also introductions to a half a dozen VCs as a result of my video doing the circuit.  Well that and id being a smashingly good idea.

At Webstock one of the people I bored to death with Vend Vend Vend was Matt Cooney, Editor at Idealog at the time.  He was used to founders telling them why their next big idea was worthy, hoping for a plug in Idealog in their new future.  Matt was bored, and I wasn’t doing a great job of it.  Possibly the hangover post Webstock closing party was not helping.  But I smiled a lot.  I think that helped.  A year later Matt recounts that hungover pitch, and my face is on the cover of Idealog.

Me banging on my drum constantly got me talking to the majority of my future investors. Sam Morgan, Rowan Simpson, Christoph Janz, Sacha Judd, Lance Wiggs.  Each of them I shared coffee, or lunch, or a bike ride, or a Skype.  It was never the case of me sitting down with them, telling the story of my vision, and them saying “Great, how do I invest?”.  These relationships took several coffees, bike rides, and Skypes.  The more I spoke to them and updated them on the vision and progress, I painted a picture of where we had been and where things were going.  On overage, 6 months from first coffee to them joining the team.  These things take time, so you need to start telling your story as soon as you can.

I also was not shy in approaching people either.  What have you to lose?  New Years in 2010, I was at my summer home at the beach and was following Robert Scoble on twitter.  I tweeted him, on the off chance he might be interested in Vend and doing a post.  A few months later I was in his house at Half Moon Bay California telling the Vend story.  I sold him in 140 characters on Vend enough for him to invite me to his house to do a video.

Then I spoke to NBR, originally about getting Sam on board as an investor, and then to talk about our PayPal partnership..

Then there was the time I presented at Under the Radar.

Then the time I presented at Webstock Mini.

Then there was a geek talk about HTML5 at WDCNZ.

I am terrified of public speaking (can you tell?).  But any chance to tell a story and I was in, even if speaking in front of a room of people smarter than me make me feel physically ill.

Then there was the time I blagged my way into the board rooms of PayPal, Xero, Intuit, Google, Groupon, Square… the list is a long one.  The point is you have to start somewhere, with something that tells your story.  I didn’t even have a product, but I could sell the idea on day one.  And these stories I told, let on to introductions to journalists, investors, partners and perhaps even future investors and acquirers.  But most importantly it led to CUSTOMERS.  My first half a dozen customers came from referrals from people who had heard the Vend story.  They liked it enough to tell someone else.

Have you got your story?  It wont be perfect at first.  You just need a story.  I cringe when I look at all our early pitches and promo videos.  But they did the trick. Your list of intros will eventually get very long too.  But everything starts at the number 1.

Start talking.

1,000 1,000

Update: Oh, BTW. I clocked up the last k at 3pm on 31 December. I had to take the last 3 weeks slow just so I could hit the last KM on NY eve.

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Next year, 2013, I am doing something I am calling my 1kk challenge.

“What’s a 1kk challenge Vaughan?” I hear you ask. Well, as you asked…

Every year I do a mad challenge. A few years back it was cycling the length of NZ solo, this year is going dry for a year, a couple of years back it was starting some startup thingy. I have quit watching all televised sports for a year (now into my 6th year), quit all mainstream news media for a year (into year 3 now).   Sometimes it is quitting things, sometimes doing new things.  I try and alternate.  And so next year I am doing a 1kk.

The idea is simple, you can run, walk, swim, ride, pogo but you have to do it for 1,000k’s (1k-k).  Or 1,000,000 meters.  Woah, that sounds a lot.

1 million meters

You don’t have to do it all at once, that’s a lot of running or walking and would be MAD, but the aim is that over the course of a year (or a bit longer or shorter) you clock up 1,000k’s.

I am going to run it. The aim is a daily 3km run, or a weekly 20km run. 1,000km is far enough that you would need to keep to a regular commitment to do it, and obviously measure it.  Doing something 3km a day is achievable by almost anyone, and get’s you into a good regular fitness pattern.  Well that’s what I figure anyway.  Ask me again in July if it is a good idea.

You should do it to.  If not only so I have someone who can hold me accountable, but more importantly ’cause I think it would be awesome!  We can become best buddies on RunKeeper.

You may just walk it, that’s a 3km walk a day (2.74km to be precise). Rollerskate? Might be tough. It is a WHOLE YEAR, and trust me, that’s a long time to do something EVERY DAY. But the rewards from doing something like this are huge, HUGE! How great will you feel at the end?  AWESOME, trust me.

I will post how I go here.  If anyone is keen to do something similar let me know.  Think twice about that xmas ham.

Oxygen Supply – Getting Funded Part I

 

The most common question I get asked by other founders and people interested in the startup scene is “How did you go about capital raising, how much did you give away, and were you happy with how things went?”.

To a founder these questions can be as awkward as “What color is your underwear?”, ”What’s your sexual preference?”, and “Have your stopped beating your wife yet”. Personal, kinda none of your business, and sometimes where “Yes and No” are both the wrong answer.

Not to say these things are or should be secrets, but every founder wonders if they went about it the right way, raised the right amount and gave away as little as they could have.

At the end of the day, funding is like oxygen, having a lot of it makes you dizzy and stupid. Have too little, slow, exhausted or dead. The trick is to find that middle position.

Simple right?

No.

It is freaken hard.

You will need to spend all your time in full time capital raising mode, usually at the same time as you are building your product, or trying to find customers. But here is a summary of how I went about the seed capital raise, and my thoughts at the time, where I can remember them.

NOTE: This is not a playbook for how to get funded. This is how I did it, and only the initial round and could be wrong for you, besides my underwear is green, what color is yours?

Before you start:

Before you even start talking to investors, you need to build a good profile and case. They will mostly invest in you, so make sure you talk to people who you can relate to, and you impress them as someone who knows what they are talking about, and can get things done. I was lucky I was involved with Trade Me very briefly, so I could throw that name around a bit (if you have big names, put them in bold and italics). I had just been involved in a failed startup, Vianet, so wanted to add another credential to my CV that showed I could complete something and win. In the US being involved in a failed startup is considered a positive thing to have on your CV. You can learn from the mistakes. However in NZ, this is not the case mostly and tends to work against you “Bro, didn’t you hear he crashed and burned in XYZ!  Flaky!” and that sort of thing.

So I rode the length of NZ solo on a bike (and uphill).

Read my blog about my ride for all the motivations to do it, there were a few. But I wanted to raise some profile for me, and prove I could do what I set out to do. But this created a backstory, and ultimately made it easier for me to raise some capital. Everyone likes a half crazy founder doing amazing physical feats. Having a crazy moustache also helped. More more on this later and in another post. For now…

Angels?

My bike ride raised my profile a lot, and put me in touch with a lot of great people who were huge supporters of mine. Some in tech circles, some in investment circles, some just big fans of facial hair.

After my bike ride, I was still building Vend in my part time, I was running a software consultancy business and in the global financial crisis I had quite a bit of spare time. So that’s why I was building a product in all the downtime hours I was not able to sell to clients. But I still needed to find work to feed the family. The time came when I needed to make the call, do I do this thing and go at it 100% or go do something else. Basically I couldn’t do both. So I went out and looked for some early stage seed capital.

“Angel” is a term that was once used to describe the retired banker who does some small investments from time to time for fun, and to help out entrepreneurs starting out. Now it mostly means “VC” without all the strings (mostly). The professional Angel is the easiest to find as they will have websites with portfolios. I googled and researched the local Angel scene, and found a few that looked like they got involved in early stage technology companies. Well that’s what their websites said. Some even had online forms that you could submit your funding request and business plan through. Awesome. I just complete the form then they wire me some cash! Yesss! One had a very comprehensive form that asked all sorts of the right questions, so I gave that one a go. A few hours later, after many pages of questions on a very flash application form, the whole thing crashed gave me errors and said my application could not be completed.  Their website also said they only take applications that have completed the form.

So I followed up via email instead, and it turned out the machine “ate” my application. Neat. So a exchanged a half dozen emails with this Angel instead. Now, when I say “exchange”, I mean I send an email, wait a week then have to chase up on it as it seems the machine eats emails too. The times I did get a response, sometimes with some questions in it for me to come back on, sometimes months later, I replied the same or next day. Then waited a week, and then two, then a month and then nothing. No reply.

I got to meet with one angel and Vend wasn’t for them, another wasn’t actually an Angel but brokered introductions to Angels (huh?).  But mostly people failing to reply to emails and phone calls. At the time I thought this was normal behaviour, and I was failing an initial screening process, and perhaps they got hundreds of approaches a day.  I had never done this before.  But now, having been through the cycle a few times, up and down Sandhill Road in the heart of Silicon Valley, I know that this was not normal behaviour. My timing could have been wrong. Perhaps I was too early stage. My business plan could have sucked. My bike shenanigans could have been a turn off, thinking I might disappear for another 6 weeks on my bike any second. Perhaps it was the moustache. Things might have changed since the GFC and I hope so. But an email or phone call saying “no thanks” or “we are busy” would have actually been nice.

My advice is to be friendly, firm and direct and set the expectation that you want to hear back from any professional Angel ASAP and then if you don’t get the attention you are after, move on very quickly. Remember, these guys do this for a living, so don’t think you are inconveniencing them by bothering them. They do get busy, and sometimes need a reminder email.  It happens.  But think, would you want an investor on board whom when you needed their help they may or may not reply to your emails? The answer is of course no.

For me at the time I gave up on this path completely disillusioned believing no one is interested in funding NZ technology companies. I was still slowly pushing my product closer to market. The irony being if I had just put my head down and not been distracted with seed funding, I may have got my product to market 3-6 months earlier, and burnt through less of my savings.  Capital raising is always a distraction, as it takes you away from doing other things like building the business.

Talk to others who have raised from local Angels, there are a lot of them around but they are quite hard to find. You need to be doing dozens of meetings over coffee to find them. Failing that go here and find some Angels and tap into these new Angel networks around the country, but really do try your networks first that way you will have a common connection and applying cold via websites dosent yield good results in my experience.

Friends and Family?

Friends and family is a good alternative to the angel round, money is money right? If it gets you going then it reduces the risk of your failure. However, I really wanted to avoid this path having had good people and friends lose money in other startups I was involved in. I wanted to keep this completely professional. If this was my next big failure then I would still have some friends and family left. Considering my failure to find a good professional Angel and the disappointing market for investment in general, my choices were limited. I tapped deeper into savings, and cleaned that out, and things were getting really tight.

I entered Vend into the Cloud Connect Launch Pad in Santa Clara, and was surprised to be picked as one of the finalists. This gave me some great exposure so early on, and helped validate that what I was doing was interesting to others. People were starting to get interested in what I was doing now.  I was building a profile and validating my idea. A few friends and family were starting to get interested as this seemed to be more than just some side project I was working on.

Two friends I was somewhat hesitant to call on, were Rowan and Sam. Looking back, I think I was perhaps afraid they would say no, after Vianet crashed and burned. I have since discovered this to be typical “kiwi” thinking pattern, “Nahh they wouldn’t want to invest! Besides, the shame if they said no” and just the whole way failure is considered, well a failure. I had caught up with Rowan on my bike ride and at the time told him about my crazy idea for Vend. I think I even had some screen shots in my bag. He helped me with my thinking around my model, and then we rode out of Wellington together over the Akatarawa ranges.

Over a number of months I asked them both for a lot of advice, still hesitant to ask them for cash. I had also gone off the whole investment thing to be honest.  I was just focussing on getting the product to market and taking help where I could find it.

Sam gave me a loaner desk in one of his other companies to get me out of my spare room. I only worked on Vend when I was at that desk and I was spending more time at that desk than anywhere else now.  I had some beta customers using the software.  I was running on the scent of an oily rag, even selling stuff on Trade Me (ironically) for extra cash.  Then one day Rowan popped by, and suggested I need to raise some capital now if I was serious about this thing. We talked some terms, assuming he was interested. A month later both Sam and Rowan had invested $100k. I could start working in the business fulltime, and gave us a budget to promote and hire in some help as I needed it. I publicly launched Vend the next month, and we were off.

In the months preceding the actual raise, I spent a lot of time with them showing them my model, talking about what we would do with the capital, and our go to market strategy. It helped that they knew and liked me. But I still had to do the hard yards proving I had a business. I could have had the exact same conversations with others, but Sam and Rowan were a part of a minority of people who took the time to listen and ask questions. I must include Lance Wiggs here too, who gave me a lot of time, and invested later on down the track.

I went to them both for advice first. I respected their experience and valued the input they could provide me and Vend. I didn’t go to them for money straight up. This is true for a lot of my other current and potential investors. Start the relationship around advice, and guidance. Ask them what you should be doing, not just about funding, but about structuring the business, go to market plan. Get their advice on everything. If they have invested in a number of companies they will have been through first hand some of the challenges you are about to face. Take their advice. Demonstrate you can take advice and act on it. Smart investors will be looking to see if you can take guidance, or do you think you know it all. The latter never ends well, unless you really do, but then why would you be asking for their help? You know it all!

Just a couple of weeks before Sam and Rowan signed the dotted line, I caught up in person with a couple of Angels at a founder + angel meet and greet event.  They were talking at the event about investment and the ups and downs of being an Angel in NZ.  Afterwards I approached one, who had stopped replying to emails, just to say “hi” and let them know about progress. I was pretty excited about Sam and Rowan chipping in, and wanted to say thanks for all their help (which was me being polite because they stopped replying to my emails). I only got as far as introducing myself and Vend then was cut off mid sentence with,

“Oh you, I sent you an email saying we are not interested. You must have missed it. We don’t invest in the retail space.”

I only wanted to say “Hi”. I never got that email, either their or my machine “ate” it.  So I just moved on to the sausage rolls.

Investors get approached a lot, and probably get stalked too so they can get blunt. Next I sat down (cautiously) next to Phil McCaw from Movac (whom I had never spoken to before), to get his opinion on what I was doing. He was engaged, interested in what I was doing. At the end I mentioned Sam and Rowan were looking to back me and asked what his thoughts were on the both of them, from his experiences from the Trade Me days.

“Go for it, you won’t look back.” And so I did, and I haven’t.

Do some due diligence on your investors. They will be doing it on you, and you want to make sure you know who you are getting into bed with. Are they helpful, completely hands off? Hard nosed, or relaxed? Do they reply to emails? I have since chatted to Phil a few times, not asking for funding, and he has given me some pretty great advice. Some investors you will talk to won’t be as helpful so hunt out the ones that are. They don’t need to invest in you to be helpful. The smart ones will see the benefit in helping the ecosystem,and perhaps they might get an opportunity to invest in you later on.

So yes finding angel/seed investment in NZ is hard, and still is hard based on the conversations I have two or three times a month with other founders trying to do the same. But with a number of great success stories starting to emerge now, like:

…it has to be getting better. Surely? Honestly I don’t know if that is true.

Don’t let a cold response from a potential investor put you off. When you are getting going, a “no” (or worse, no response at all) is devastating. You desperately want to know others see your vision, and that you are not some crazy nut-bag. I almost packed it in when it seemed no investors wanted to talk to me. But I just needed to feel out what and who were the best partners for me. People do actually get funded, even though we are not in Silicon Valley. But it is hard hard work, and it is hard work in the Valley too. Did I mention how it is hard work? It is hard… work.

So here are some tips if they are helpful to you.  Again this is just based on my limited experience:

  • Build a profile, and establish a story around you. Investors will invest in you first then your idea second.
  • Get enough cash to get you going 100% into the business. Doesn’t have to be a lot. But it starts the investment cycle which is a long one that only ends when you exit or break even. Plan on getting good at raising money.
  • This seed backing will make it easier when you come to the next round as you will have some history and a track record, and you will be a little more practised in capital raising.
  • Getting backing from successful business people is a bonus, especially if they exited for large amounts of money.
  • Friends and family are good too. Spend all your money first before asking them.
  • When talking to investors claiming to be professionals (i.e. they do this for a living), if you are not getting a response then drop them a line to say “thanks” and move on quickly. Time to market can make all the difference to your business, and it sucks having to chase people up for a response to an email.
  • Talk with a lot of people. A lot.
  • Talk with people you like and feel comfortable with. You will hopefully be working with them for a long long time.
  • Look for really simple terms. Leave complicate stuff like vesting, liquidation prefs and all the other stuff for much later. You are looking for a small amount of cash to get you going. That is all. You aren’t raising $10M.  Seed funds should come with little to no strings.
  • I gave away 30% for this round. Your call on if that is right for you. I am a sole founder, so I was looking at my early stage investors as being part time co-founders, and they have supplied more than just cash, in the form of time and resources. It was a good deal for me. You should reward your early stage investors as they are taking a huge punt on you before anyone else does.

I have since moved onto two additional funding rounds totalling over $3M and will cover this stage in another post later on about the A and B (and possibly C, D, E) rounds.  Like I said, you are always in capital raising mode :)

Good luck! If you have a story I would love to hear it.

World domination from the bottom up

Probably the world's greatest POS

I bumped into Dylan Bland the other day.  Always great to catch up with Dylan, as I have always admired the stuff he has done, and the projects he has worked on.  Actually, truth be told, it was more like a few months ago we caught up, I am just embarrassed that it has taken me this long to deliver on a promise I made to him at the time.  When we caught up, I was blowen away when he asked if I blogged and if I didn’t, he suggested I start as a lot of people would probably be interested in my journey at Vend.   I am still at the very beginning of my journey, and so I felt really apprehensive about writing about it as anything to shine a light to, because it could all still crash and burn.  Kiwi modesty and all that.  I was genuinely surprised that he was interested in hearing about it all from me.  And so I promised to him I would start blogging again and sharing some of my learnings around starting up a startup, global expansion, capital raising, team building, branding, whatever.

Months later, I remembered my promise and then sat here wondering what I should write about first.  So I tweeted Dylan and asked him for a topic.  He gave me 7.  Should keep me out of trouble for a while.

So starting at the beginning.  Why I started Vend and why you should do something similar.

It was pretty simple for me, the motivation to do an online startup.  I am a software engineer of 15+ years.  I was doing consultancy and the limit to my earnings was how many hours of my time I could sell, and there was a finite number of them.  I was inspired by companies like Xero, taking really bad software like accounting apps, and making them sexy, on the cloud and a pleasure to use.

The global financial crisis started.  Work dried up, I was living in Kerikeri and having to commute 3 hours to Auckland to find work.  I was spending weeks away from my wife and two daughters having to sleep in my old bedroom at my mothers house while I dug up work in the city.

I have been involved in another online startup, Vianet.travel (now Travelbug.co.nz) as CTO and although it was ultimately acquired by Trade Me, it was a fire sale and the project was a failure on many many levels.  We burned a lot of money, and left a lot of good people without jobs when the cash ran out.  I was strangely fortunate to have sold some shares early on in the piece, at the height of Vianet’s very short lived success.  Not a lot by any means and I couldn’t tell my bank manager where to go. I was not on board when Vianet ultimately crashed and burned, but I saw enough to surely put anyone off doing a startup for life.

My wife Mel observes of me that I strive on stress.  It is the problem solver in me I guess.  Things got pretty stressful at Vianet, but unfortunately it was the sort of stress you had no control over, and sent you off to the doctor to get blood pressure tests for mystery headaches that never went away.  I vowed never to find myself in that position again.

And so why Vaughan, why would you want to do it all again? WHY?

1. The buzz of a startup is an addictive thing.
2. I saw a lot of mistakes made in my 5 years on Vianet, and made quite a few of them myself.  And hopefully those mistakes would be things I wouldn’t be stupid enough to make again.  Or rather I wanted to prove I wouldn’t.
3. Because I want to make money :)
4.  I was basically unemployable.

But forgetting my personal motivations, there were some other compelling reasons to build a product like Vend.  I saw a lot of industries that still today use really bad software that was probably written in the 90′s in Foxpro.  All of it ugly, hard to use, offline and expensive.  I knew the “cloud” was where things needed to head, and so I looked around for a big vertical that really needed a new product, and would be happy to pay for it.  Retail seemed obvious to me, as I had done quite a few ecommerce projects, and saw a lot of innovation in the online ecommerce space for retail, but I couldn’t find any evidence that this innovation had bleed into the way a bricks and mortar store runs their business.  I knew you could reinvent retail point of sale, inventory management, product management, CRM, reporting (…) under the SaaS (Software as a Service) model.  Let retailers pay a small monthly fee and get great software that has the features once reserved for the WalMarts and their $100,000,000 infrastructure.

There are plenty of industries that still need to move to the cloud, just look around.  Talk to everyone you know, and ask them what software they use in what ever line of work they are in.  Chances are it isn’t cloud based, but sure as hell could be.

So not only did I have a point to prove to myself about doing a startup, but I could see this obvious opportunity ahead.  And I began on the prototype for VendHQ (now just called Vend) using all my down time from consultancy.  I stopped driving 3 hours to look for work, and spent more of my time on building a product.  It didn’t pay very well.  I used up all our savings, and things were really tight. Balancing enough contract work to feed the kids, and still giving me enough time to get a first version of the product ready.

When I was confident I could complete the product and customers would pay for it (you never really are 100% confident people will pay you money for your stuff) I decided to go boots and all in on Vend.  I still knew Sam and Rowan from by brief  dealings with Trade Me back in the day at Vianet.  Well enough to drop them an email and tell them my crazy idea.  I relocated the family from Kerikeri to Auckland.  Sam gave me use of a desk in one of his other companies, and Rowan gave me a lot of time and advice and helped me build the model for how the business will work (the spreadsheet model we put together on day one is still used every day by me, but I will write a post on building your model later).

I listened to all their advice, demonstrated to them that I was listening by taking it onboard doing stuff.  And then when I thought the time was right I asked them if they were interested in helping me bootstrap Vend, investing a little so I could go full time and get some help.  We threw in $100k into a bank account, and so Vend was officially born.  2 years later, we have customers in 100 countries, with tens of thousands of accounts, and have an office in Auckland, San Francisco and one about to open in Melbourne.  We have been cashflow positive, and have been invested in by off shore VCs.  We partnered with PayPal to deliver a world’s first integrated mobile wallet and POS.  And we are still doing awesome stuff.  We are having fun.

Sounds easy huh?

Well I am not telling you about the 6 months of my life prior to asking Sam and Rowan to invest, where I smashed my head against very hard brick walls trying to get money from VCs and angels in NZ.  I am not telling you how I established relationships with investors like Sam and Rowan, and ultimately some VCs.  I am not telling you about a pretty awesome bike ride I did before committing me and my family to the Vend roller coaster.  I am not telling you about how I got the first customer, how I picked the technology we now use and why I backed HTML5.  I am leaving out a hell of a lot of details obviously, because the full story is a really long one.  But one I will chip away at over the next year or so, depending on how much time I get to write.

I asked Dylan for advice on what I should write about, because I am so wrapped up in doing Vend, it is not obvious to me what anyone would be interested in hearing about.  He gave me some awesome suggestions.  So let me know if you have a suggestion too.  Hopefully I have some useful advice for you.  Worst case this is just some big rant that only I read, but it will probably give me some laughs in 5 years time when I sit in Hawaii drinking mojitos, <touches wood> (do read Rowan’s blog too, he is much smarter than I am).

So here are some posts I will write in no particular order (or guarantee I will actually get to write them)

  • Raising cash
  • Your integrated model – how does your business work
  • Generating buzz and profile
  • Building a minimum viable product
  • Company culture – the family team
  • Bootstrapping vs going BIG
  • Going to “The Valley”
  • Brand and the personality of your product/company

Ahh crap, that’s a lot to write.  Better add “Time management and work life balance” to the list.

Using an all US Apple ID in NZ

OK so this post started as a “how to” on how to best setup all your iOS devices with ONE Apple ID in NZ, and still get access to all the goodness of the US app store.  But  before I even get started I fear this will turn into a rant about how stupid this situation is.  Just wait, you will see.

Firstly, I have 2 Apple IDs.

A NZ App store Apple ID, registered to my NZ Visa.  This lets me access a subset of music, video and apps on the App Store.  There is some NZ only content that I can only access with this ID, but that is by far the minority.

A US App store Apple ID, setup to use vouchers that I buy when in the US.  This lets me buy and rent ANYTHING from the US iTunes stores.

And so when I buy apps, I use my NZ ID as this is linked to my credit card, and I can buy freely without having to worry about how much credit I have on my iTunes account, and if I am going to run out of credit before I next go back to the US.

(wait for it)

When I rent movies and TV shows, I have to sign out and sign in to my US account and use this, because in NZ we haven’t been graced the privilege to  PAY the media co’s our precious money to WATCH THIER STUFF.  I knew it would get ranty.  I will try and hold this in for a bit, so I can first actually give you my solution.  Then we can talk about HOW STUPID THIS ALL IS.

So I have been living with two Apple IDs for ages, and at home we have no less than 9 Apple devices, a mix of laptops, iPads, iPods, Apple TVs and iPhones.  Yes I pay my Apple tax.  But to get my iTunes music (mostly BOUGHT from iTunes, the rest ripped from CD) to be shared across all devices and on my wife’s devices and use all the other apple services that all need to be linked to an Apple ID, it became clear that switching Apple IDs constantly was no longer going to work.  Why?  Because:

  • I FaceTime my kids and wife.  So I need to link my FaceTime to an Apple ID.
  • I buy stuff on the app store
  • I buy music and video on iTunes
  • I subscribe to iTunes Match to sync all my stuff to my Apple TV and my Wife’s devices, so we don’t have to buy the same albums twice
  • I use iMessage
  • I use Home Sharing
  • I sync my iPhone wirelessly
  • And all the other things I am going to do with my Apple ID in the near future.

Managing all these services across multiple IDs is a NIGHTMARE.

So here is what I did.
NOTE: this will only work in NZ.  If you are trying to do a similar thing in another market you will need to swap our the step on linking a credit card for a voucher as described here.

  1. First, register as an Air NZ Airpoints customer.  It’s a pain, and probably costs you money, so only really both with this whole thing if you fly Air NZ and want the air points.
    https://www.onesmart.co.nz/  or http://www.airnewzealand.co.nz/joinairpoints
    You will get a OneSmart card posted to you that is a credit card that can store multiple wallets in different currencies. If  you are already an Airpoints customer, you will have been posted one of these already just before Christmas if you didn’t throw it in the trash.
    It is actually a smart little card, and if I could link it to my BNZ EFTPOS chequing account it would be infinitely better reducing the cards in my wallet to two.  My OneSmart and my drivers license.
    You are welcome Air New Zealand.
  2. Next link your OneSmart card to your internet banking and transfer some money onto it.  The instructions are on the OneSmart site.  It’s really easy.
  3. Then convert that cash you just transferred into a US wallet when it clears.  Follow your nose on the AirNZ OneSmart site.
  4. Then create a US Apple ID (you can do this in any of the Apple App Stores or on iTunes), load your OneSmart card number as your credit card.  It is a MasterCard!
    NOTE: You will need to wait until the money you have transferred to the US wallet clears, as Apple with try  to do an auth of $1 on the card to make sure it is valid and has money on it.
  5. You will need to pick a US address also.  Just make one up or look up a hotel in your favorite us CIty.  I have an office in San Francisco, and I practically live there so I used that.
  6. Once you have created your new Apple ID, change all your devices to use it.  So the app stores, iTunes, Home Sharing, the lot.  Much simpler.
  7. Start buying stuff on iTunes and the App Store. All your apps, music and video magically syncs across all your devices.  Heavenly.  You US wallet will be debited.

Thats it.  You will need to keep your OneSmart US wallet topped up regularly, and there is a $1 fee each time, plus the currency conversion is not the greatest but OK.  Remember that the currency conversion happens when you transfer money to the US wallet, not as you spend it, so if there is a favorable exchange rate, load up the card!  So not as convenient as using your NZ credit card to BUY STUFF.  But almost as good.

If you have a whole lot of purchases on your old NZ Apple ID, there is no way you can transfer these to the US ID or to merge two Apple IDs.  So for any app updates, you will need to switch over to the NZ Apple ID to do this on the App Store.  Still a pain, but I can live with this.

And so finally, why the HELL do I have to do this, probably breaking copyright law to illegally purchase software, music and video along the way?  This is just plane crazy, and it shouldn’t be this hard to give money to people.

CRAZY!

Taking a deep breath… perhaps I can download a movie to calm me down… and I will give some more money to THOSE MUPPETS IN HOLLYWOOD!  Not the Jim Henson-Disney kind either.

New York, Chicago (and Ottawa)

I just had an amazing week travelling to NY, then Ottawa, then Chicago.  Loved the snow, and the buzz of NYC.  I would go back in a heartbeat.

Times Square

Picture 1 of 16

Telecom, your customers are not lying douches, you are.

Firstly, I must make clear I have learned to love Telecom again over the last couple of years, they have rebuilt a brand that looked like it cared, and was customer focussed.  I like their new MO for building an enduring brand that cares about their customers.  Their new XT network kicks ass too.  It’s hands down the best in town (and out on occasion).  I love their XT network so much, I tell everyone to move to it at every opportunity, doubly so if they have a smartphone.  I have moved all of our work mobiles to XT recently and slightly less recently I convinced my wife to move her phone too.  She had bought a Samsung Galaxy recently and found coverage and data patchy on Vodafone.  She didn’t really want to move as to her how the phone works it is all voodoo magic, and moving seemed to be a bit of a hassle.  But she did and immediately found better coverage and better data.  Yes! Another convert to Telecom.

To move her over she went to our local Telecom store, in Botany Town Centre, to get help with the move, and to make sure her phone would work as well as get the SIM, and see what discounts she could get as she was coming to Telecom with her own phone.  To make sure her phone would work, the guy in the store told her to put a Telecom SIM in the phone to be 100% sure, but told Mel her Galaxy should work.  So we grabbed a SIM, popped it in, and voila full bars and XT awesomeness.  I had also checked on Telecom’s website to make 100% sure her Galaxy would support the XT network as it is very different to Vodafone’s.  You can do this simply here by entering your IMEI number from under the battery in the phone.  This will tell you if your model of phone will work on XT.

http://www.telecom.co.nz/mobile/mobile/ournetwork/phonecompatibility

And great news the model of the Galaxy Mel has is supported and works on all the right frequencies, but the website does also suggest popping in a SIM to be super sure.  We did that, full bars, choice!  So Mel moved across.  She was given a credit on her account in exchange for a 12 month contract.  No sweat, there was no way we would go back to Vodafone now.

So that was a few months ago.  Since then she has had a few strange areas of patchiness on the network where my phone would work and her’s wouldn’t.  I put that down to different aerials as hers was a Galaxy and mine an iPhone. Not all phones are equal.

So roll forward to today, well 3 days ago to be precise, when we rock out of town on holiday.  We are sitting in Warkworth, one of the many places that kiwis live and play, and Mel asks me to look at her phone as she is getting bars but can’t make calls.  Her phone says “Emergency calls only”.  I fiddle, and find her phone can’t see the Telecom network at all, only Vodafone’s.  Odd.  I do some digging online while lounging around at the beach (on my XT phone) and learn that Telecom has two frequencies on their network. 2100mhz for high density areas like Auckland and a nationwide 850mhz network to cover everywhere else.  Who knew? Mel’s particular Galaxy it seems can not connect to the 850mhz network, so Telecom is invisible to the phone when out of Auckland.  And so I fiddled a bit more, and did some research on Geekzone and found that Mel’s phone just wont support the Telecom 850mhz network, which is the everywhere network, so without this the phone is only good for in the major centers.  Unless we hack the phone, root it and upgrade the firmware or mod it which we weren’t going to do as this voids all sorts of warrantees for sure.  Also Telecom wont support us if we did this.

And so feeling slightly jipped and confused, I got Mel to ring Telecom to make sure this was the case.  The guy in the Telecom store who signed her up told her that her phone would be fine.  We followed the instructions that Telecom gave us, and the tests all told us her phone would work, which was obvious as the SIM she put in the phone worked!  Full bars, great coverage… until we left the city.

First person we speak to tries to help with some basic tests but still the same issue.  I knew the problem was that the phone could not see the 850mhz network, so turning it off and on didn’t seem to make any difference.  So Mel was escalated to 2nd tier support, and did some more tests and fiddling, and then they agree that it seems more complex, so Mel was put through to 3rd tier.  We were relaxing at a bach and not too stressed at this stage as we were at 3rd tier support.  They would be able to sort it or confirm if her phone just wont work.  They hung up on us.  So we ring back and ask to be put through to the 3rd tier support guys.  We get put through to a dead line, just silence.  Mel was going to hang up thinking she was disconnected again, but I told her to wait, incase it was just the hold music not working.  Sure enough, after 20 or so minutes the hold music starts.  Lucky she held on, and the hold music wasn’t that bad.  We had Greg Johnson and Chris Knox to keep us company, which was good because we were on hold for another 2 and a half hours.  The lady in the call centre who put us through came back to us every 15 minutes asking if we were happy to hold, we were, but eventually after the first hour she stopped asking us.  So we waited and waited, read books, and waited some more.  It was 9pm and we figured they were not going to come back to us at this stage so we hung up on them – Telecom’s website says technical support closes at 9pm.  We would try them again in the morning.

Next day, we ring nice and early so we can get on with our day, and try desperately to get back the the 3rd tier support guys.  Hopefully today they would answer their phone.  Every time we rang 123 we get someone else who has a different idea about our situation.  We had a fair few of them as it seems that even though Telecom is a telecommunications company they can’t actually work their phones themselves or their hold music so being hung up on was a frequent occurrence.

We finally talk to one person who seems to know a thing or two and suspects the same thing we do, that the Galaxy wont work out of major centres.  Apparently the Galaxy S’s they sell have had modifications so they run on both Telecom networks and because we didn’t buy the phone from Telecom ours hasn’t had the necessary tweaks.  They couldn’t confirm this officially, but told us it was up to us to make sure the phone worked before we signed.  What!?  We did.  We went into a Telecom store, spoke to a Telecom sales person, followed Telecom’s advice and the phone worked!  We were unaware that Telecom ran two networks and that all we were testing was that the phone would work in the city.  There was very little she would or could do, other than suggest we buy a new Telecom handset that would work on both networks, cancel our contract and pay the $280 release fee, or take the phone back to Noel Leeming as they sold us the wrong phone.  No they didn’t, we bought the phone before we were on Telecom.  Pay a release fee?  Seriously?  Telecom signed us up to that contract under good faith that our phone would work.  But according to Telecom, it wasn’t Telecom’s fault, and if it wasn’t Noel Leeming’s fault, then it was our fault for not testing the phone out of town.  WTF!  Really?

And so they refused to do anything, other than suggest we go back to the Botany Telecom store and take it up with them.  We are out of town on holiday, so that was unlikely.   So after some needling we get them to conference us into a call to the Botany store, so they can tell them what the issue is and get them to help us.  We get cut off.  There seems to be a theme here.

So we find the number for the Botany store and ring them direct.  We repeat the whole story once more for good measure, and get once again what seems to be a standard response, being that it was up to us to make sure the phone worked and it wasn’t their fault.  But didn’t they tell us the phone would be fine!  Yes, but we should have somehow known that it was fine only on Telecom’s around town network.  WTF Telecom?  Are you serious?

More heated discussion, as you can imagine we are getting slightly pissed about the phone experience, if it is not the waiting on hold, getting cut off, having the buck passed, it is being told constantly that it is our fault.  So they suggest we go to the closest Telecom store to us, being Silverdale which is still 30 mins drive from us but we can give them the phone, and they would do some tests on the phone and check the settings to see if they can get the phone to work.  They told us that we could get the Silverdale store to ring them if necessary and they would explain the situation and see if we can get this resolved once and for all.  They can put in a new SIM and see if it is a problem with the SIM.  Okay, not sure what that will do, but Yay!  Some action.

We go to the Silverdale Telecom store, feeling positive that we would get some resolution finally.  Hopefully they can tweak the phone, or cancel the contract for us.  We are desperate to get on with our holiday and put of a trip for the kids to Waiwera hot pools so we can get this sorted.  We really just want a working phone at this stage, and if it means we have to go back to Vodafone then so be it.  We just need the phone to work for us out of town.  Two minutes in talking to the Telecom person about our problem at the store and then she launches into a defensive rant about how this happens a lot and we needed to be sure our phone worked before signing up.  It is almost like she got this a lot, being in Silverdale where you need the 850mhz network.

Look here you morons, we did check, we did everything you asked us to.  Then she types in the phone’s IMEI into her computer and then tells us the “system” tells her the phone may work some places but won’t work out of town.  WTF!?  Really, that’s not what the Telecom website told us, so I walk around the back of her desk and look her screen, and she is using the same fucken screen from the Telecom website I used, and it didn’t say “won’t work” at all, it said the same fucken thing it told us!

This device should work on the XT Mobile Network.

To confirm your device will work on the XT Mobile Network, please visit a Telecom store or dealer to try your device with a Telecom SIM.

She then refuses to put a new SIM in as she tells us she KNOWS that this phone won’t work because it is not the Telecom model.  Only the phone bought from Telecom will work. How come she knows this and no one else in Telecom does!?  We ask her to talk to the Botany store as they sent us here and they promised us that it would be sorted here.  She refused to call them explaining that they are not an actual Telecom store, but are a Leading Edge Communications store. Therefore she wasn’t going to help as it was not their problem.  After some more argument, she finally agrees to call the Botany store but assured us again that she can’t help because they aren’t actually Telecom.  They just have a store that is 100% wall to wall branded as Telecom, sell only Telecom phones, wear telecom shirts, but they are not Telecom.

“Yes, ahuh,  yeah they have a Galaxy that won’t work on Telecom, yes, I know, yes they should have checked first, ok I will tell them”.

Then she explains that Botany told her that, yes, the Galaxy wont work and we should have tested it before we signed up, and it is really our problem.  They also said that this couldn’t be resolved in store and we would have to ring 123 or come into the Botany shop.  Why on Earth would we have taken a couple of hours out of our holiday to go to a Telecom shop if we were not directed to do so.  WHAT THE FUCK?

So at this stage, we have been on the phone for 6-7 hours, driven to a Telecom store under the advice of Telecom, to be told they flatly wont help us as they aren’t Telecom.  And then the original Telecom store who sold us the contract, who sent us there, confirming that yes it was our problem all along and they weren’t going to help either.  So we have royally been given the run around over three precious days on holiday.  No one wants to help us.  Not the call centre, not the technical support team, not the local Telecom store and not the original store that sold us the contract and who told us the phone will be fine.

At the same time as Mel is dealing with all this, I tweet @telecomnz on Twitter for help.  All the other channels are failing us, so perhaps they can help.  Richard who is the community manager on the Twitter team offers to put us in touch with the Customer Resolution team.  Great, I love the sound of that team, they surely can resolve our issue.  We just want to know if the phone can work, how to make it work or to release us from our contract.  Help at last!  Rachael from the Customer Resolution team gives us a call, after we pass on all the details of our problem in an email.  She is helpful and sincere.  She offered us $100 off a new smartphone.  Nice offer, but it would still cost us $700 to get a new phone when we had not long ago spent that much on this phone.  She told us we could sell our one on Trade Me.  No thanks, that was going to be a big hassle and we didn’t want to shell out some cash at this time of year.  It was late in the day, and she promised to call us back in the morning with a better resolution. Great.

Next day, Rachael calls back as she promised.  Firstly she suggests we lied about trying a SIM in the phone first.  They looked into the logs on our phone on the network and can’t see any other SIM ever being used in the phone.  So if we didn’t test it then it is our fault.  WHAT?  We can’t remember what SIM we tested it in, perhaps it was the same fucken SIM that is STILL IN THE PHONE and THAT WORKED AS WE WALKED OUT OF THE STORE?  She then suggests it is just patchy network reception and we are at the beach after all.  She says this as she talks to Mel on MY Telecom phone.  Mel’s phone is dead as a doornail anywhere north of Albany.  It is not just the corner of the Bach she is standing in, it is the WHOLE NETWORK.

She also suggests we go back to Botany and take it up with them, and perhaps the guy there can fiddle with the phone and might be able to get it to work.  No, we are on holiday and we need a phone to work, we are not going to drive for more than an hour back into Auckland to Botany, on the faint hope that they can fiddle with the phone and get it to work, when it seems clear to us that the phone will never work.  And how would they guy in the Botany store know he has got it working on the 850mhz network when he is in Auckland on the 2100mhz network?  After 3 days of headache and going in circles it seems simple to us that perhaps the best option is to release us from the contract and we can go back to Vodafone.  Not ideal for us, but it makes the most sense.  There will be a Vodafone store on our travels on holiday somewhere.  No, Telecom won’t release us from the contract.  Full-stop.  Rachael then cites the terms and conditions of the contract and states that it is up to us to make sure our phone works on their network and that they don’t guarantee their network will work well everywhere – and that the area where we are holidaying is listed as an area of fair coverage, she doesn’t seem interested that the phone couldn’t pick up the network in Warkworth or Silverdale or ANYWHERE NORTH OF AUCKLAND either.  So there is nothing she can do.  We tell her we will cancel and move back to Vodafone, and she confirms we will be charged $280 early termination on our bill.  We confirm that if they do we will take this up with small claims, the ombudsman, FairGo, whomever, and tell anyone else considering to move to Telecom, not to do so.  Not because their network may or may not work for them, it probably will, it is a great network, I love it to bits.  But because they royally fuck their customers over when things go wrong, and can’t seem to be able to put things right.  Waiving the $280 seems like a small price to pay to get a customer, who uses Telecom for 7 other connections, back on side.  Instead, it seems that no matter what, the customer is always WRONG.

  • Telecom actively courts moving your phone over to Telecom.  Here is their latest offer for smartphones.  The Samsung Galaxy is a smartphone.
    http://www.telecom.co.nz/simoffer
  • When moving your phone over, Telecom’s advice is to use their online form to check your phones IMEI to see if it is compatible.  Even their own internal staff use this form.  The form said the phone should work, but check with a XT SIM in it to be sure.
  • We put in a XT SIM and it worked, which was obvious as we signed up the contract and have been using the phone in Auckland for five months without a problem.
  • The fact that the phone doesn’t work on the 850mhz network outside of the main centres is as far as Telecom is concerned the customers problem as customers really should have tested this themselves before signing.
  • How is the average consumer
    1. expected to be aware that there are two networks (when most of the Telecom staff we spoke to weren’t themselves aware)
    2. adequately be able to test their phone on both networks?  How would a consumer know if they are on the 2100mhz or the 850mhz network at any particular time.  It seems that this is in fact impossible for the average consumer to do.
  • It seems that a lot of the people we spoke to within Telecom actually knew all along our particular model of Samsung Galaxy wouldn’t work but didn’t make this information available to us upfront, instead confessed this to us as we were being buck-passed on to someone else.
  • Telecom value the $280 contract early termination fee over 6 of their staff members’ time, including 7 hours on the phone over 3 days, as well as valuing the $280 more than the three days of their customers precious lost time when they are on holiday.

And as no consolation whatsoever the final message I get from Telecom after I let them know I am cancelling our account is from Richard on Twitter who seemed to be the only person within Telecom actually wanting to help.

Below average advice seems to be the standard for Telecom at the moment.  They appear as an organisation full of finger pointers and buck passers. Yes, Mel is pleased not to be having any more unhappy Telecom experiences.

My guess is Telecom get this a lot, but instead choose to baffle customers with confusing information, and frustrate them into buying Telecom phones.  When what they really should do is make sure their customers phone work on their network before signing them up.

Boooo Telecom. You are still the shallow greedy telco that intentionally confuses consumers to your own benefit. Grow a soul.