Top tribulation: commitment levels
The intention of my column is to share the inner workings of start-up life for me and my company, as well as, to share the personal trials and tribulations that come along with it. As with all things, there is success and there is failure. For me, success can create a sense of accomplishment and failure is a character builder. As we have all heard, it’s what you do with failure that can define who you are. Lets hope I dont need to build any more character.
Things have been challenging lately. This doesn’t mean bad, just challenging. One of the things that has been creating a challenge has been dealing with the issue of those who over promise and under deliver. I find this one of the most difficult things to deal with as a startup. You set expectations and when they are not met, it creates a certain level of frustration. Perhaps it’s just me and maybe my expectations are to high but they are set by what others represent in their ability to deliver. When this doesn’t happen, it can have a trickle down effect that can be very meaningful as a startup.
I mentioned in my last post the challenge of no one having quite the commitment towards your startup as you do. No one wants to work as hard as you do and frankly, outside of those who are on your team (if you have one), most people just don’t get or appreciate the focused approach and sense of dedication it takes to launch a startup company and make it successful.
Setting frustration aside, it’s getting exciting
That being said, and setting those frustrations aside, I am at the stage where things become very exciting. I am funded by a few friends and my own bank account. I am very pleased with how far we have come with our limited resources. I have managed to launch a successful beta web app and have received good feedback. We continue to develop, debug and improve on our efforts. It’s very difficult to bring out a beta app because you never feel like it’s ready. I have a new appreciation for those that have launched an application. In my case, I am the only one who is responsible for the ultimate design and functionality. All QA falls on my shoulders which makes finding unknown issues a challenge. We went live with a few bugs but there was a great sense of accomplishment when we finally got to that point.
Now, on to the next milestone. As you might expect, we need more money. This comes as no surprise as raising capital is an integral part of the process to grow a company, however, this can be another source of anxiety. I believe that I am creating a product that the market needs and wants. There are one or two other companies that are going down a similar path as mine. They have received good recognition lately, but in no way does this guarantee success for all.
When raising money there are many questions. Should I continue to bootstrap until we have revenue? Should I sell equity? Should I consider a Convertible Debt Offering? How much money will I need? How long will that last?
Adding on new responsibilities
A new level of responsibility comes with having investors. At this stage in a startup, it is frequently said that investors may like the idea but they are really investing in you. When said like that, it adds even more pressure to deliver success. For those of you following along, I have elected a $700,000 Convertible Debt Offering as opposed to selling equity as a Series Seed round. Our memorandum has just gone out and I am on the road. I’ll let you know how it goes.
Amidst the challenges of a startup, there also comes a time when things can just fall into place. For the last year, I have been building a company and an application on the idea that I want to be a brokerage and offer agents, clients and consumers a more transparent user experience. This is very possible given the rules and regulations of the local MLSs and the NAR, but it’s a challenge to scale. Going market by market, Redfin, Sawbuck, Zip and others have demonstrated this can be done.
Enter the Spark Platform announced by FBS. It could be a game changer. This is an API solution aggregating the data and licensing of participating MLSs and is exactly what we have been architecting our brokerage solution to work with for the last year. The real estate industry has a lot of old software out there. A lot of brokerages have issues with their legacy systems that are not designed to work with modern day APIs. They may not be able to leverage the Spark Platform. On the other hand, this is exactly what I was anticipating and solves the issue of scalability for my company.
Having a startup is a challenge in just about every way you can imagine. Perhaps the most important element is the ability to manage your personal life as well. I have a wife and a daughter that mean the world to me. I suppose in a way, we have all made a commitment to my startup. It is very difficult at times when you start wondering if what you are doing is the right thing. The emotional aspect is a roller coaster ride not for the faint of heart. My family probably gets the short end of the stick at times, but they support me when I need it. What keeps me going is when I wake up, read a great blog post by an industry leading consulting firm about how a new group of applications is redefining the way agents work with their clients, know that I fit right in that space, and can’t wait to get to the office to get to work… and I love it!