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.