#21: The Story Of My Tech Startup

Sam: Hello and welcome back to another episode of the lazy entrepreneur I’m your host Sam Priestley and there’s normal we’re joined by my lovely wife ever say hello
Emma: Hello
S: so today I’ve got quite a good story I hope for you it is the story of my attempt to start a tech startup back in 2012 we started in early 2012 I was 22 at the time and 23 by the time the story ended we started working on it in about February March and we sold it just before Christmas which sounds like a real success story. Something about it were quite successful but generally the successes that happened were more out of luck than anything and really it was just one business mistake after another kind of chained together with kind of naive arrogance and optimism thrown in so I can’t talk too much about the exact details of the agreements we came up with at the end of this because it’s covered by a confidentiality agreement but I can talk about generally about it and the basics of what the business was sound good
E: sounds good what did you hope to get out of starting a tech startup
S: that’s an interesting question and a good point because what do I mean by a startup why am i calling this one a startup and not all the other businesses that I talk about on this podcast and the reason is is that I kind of separate in my mind types of businesses one of which is a start-up the other one’s a what I call lifestyle businesses
E: yeah
S: most of the ones in this blog are about lifestyle businesses where the point of the business is to promote your lifestyle to build enough income enough sort of freedom of time to live the life you want whereas this business was the other type where you almost living your life for the business and where the business is is the end goal of what you’re working towards and so the idea was this would be like Facebook or Google or something like that something we would pump loads of time energy money into it would grow to a big amount and then we sell it sell it on for millions of millions
E: yeah because with this startup you had an office and you had staff whereas with all of your other businesses you can run in your pants from your bedroom
S: that’s a bit of a generalization
E: it is but also quite funny
S: yes yes that was the end goal really was to go from kind of close I was already working on some businesses at the time and I was making good money but what we wanted was to take it things to the next level to go from you know six figures to the seven figures
E: yep so you already have money to invest in this business
S: yeah and the way this worked was that I had a business with three of us which I talked about in one of the other podcasts we listened to my like professional gambling podcast yeah we talked about what we were doing and how all the time while we’re running our main business what would happen is one of us would be given kind of the time and an investment to go off and start a new business and that’s kind of how I run it they would keep bringing in money and I went off and ran this business
E: yes start something new
S: you start something new to hopefully would have eclipsed everything else we were doing
E: yep
S: and spoiler alert it didn’t it all right so let’s get a story so what was the business it was a comparison website for these financial products called exchange-traded funds ETFs for short we don’t even really talk about too much about what they were but they were they’re very popular financial product with passive investors because what they basically are is you buy one item and it contains a lot of other things so if you wanted to invest in all the companies in the stock market insider FTSE 100 you could buy a FTSE 100 ETF so instead of having to pay the transaction fee to buy a hundred different companies you just buy one company one ETF but the problem is you have many companies which are selling an ETF for the FTSE 100 so now they all are selling the same thing how do you compare the difference between them and at the time there wasn’t really any way to do that so we thought of building a comparison website thinking about money supermarket if something like that confused.com but for these technical financial products
E: so how’d you come up with this idea because previous to this you were doing matched betting and the gambling business which is quite different from the trading and the financial market
S: yeah I think that we kind of saw the financial market as like where the big boys were the big money yes
E: yeah way to make money
S: and so we’ve been looking for an opportunity there for a while something that we could do could you thought there’s a lot of money flowing around there we’re clever guys you know we can think of something and someone told us you know these things were getting quite popular and there wasn’t really a good way to compare them
E: brilliant
S: which leads me on to the first step that we took this business which was to research it was this idea a good one at the time I’ve never heard of an ETF before and really I didn’t really know what they were until a couple of years after finishing the business
E: This is why we like you Sam, you admit to things like that
S: It is embarrassing I think I understood it but I didn’t really understand why anyone would want it yeah as one nice businesses where even though I didn’t know much about it the more research we did and the more focus groups we held on it the more people kept telling us what a great idea it was and how much the market needed it which um I think kind of makes sense but it’s also pretty silly on my behalf because what is risky bull so why would I come commit you know my myself my life basically
E: Your money your time
S: to something I didn’t really understand yeah so how do we start turning around March time we had this idea and so before we start researching it so generally all my businesses kind of start the same where I try and invest as little money as possible and really bootstrap everything and this business was no different so what we did is we went out and we found someone who was willing to work on a small term contract just to deal with the research with us he was a very clever guy we found this guy called Brandon a bit of a genius he just finished his third degree LSC and was struggling to find a job
E: how did you find him
S: I can’t remember now I think he a friend of a friend
E: did you advertise the role anyway or was it you were just asking friends
S: friends I think was a way to do it we did advertise it but I think the more we started asking around does anyone know anyone who’s looking for a job at the moment who’s interested in this sort of stuff and basically the deal we came up with him we’d give him was we pay him pretty close to minimum wage on a weekly basis and then if the idea turned into something good we would sign him up to a long term contract so we kind of agreed his salary before we were gonna pay him a salary yeah so it’s a way for us to quite risk-free to do it for him if it worked out it would be good for him if it didn’t work out he’d have a bit of work experience while looking for other jobs yeah I mean it was a little bit of a win-win I think we’re quite lucky to find him because it was really good so he did the research he spent about a month going deep into it looking into you know is there space for a product like this how are we gonna monetize it is anyone else doing it what’s the risk if a big company came and just copied it and started doing it like that are they doing it in other countries and all that sort of stuff you want to know
E: and did you come up with all that criteria for him or did he did you give him some and then he added some more questions to kind of test
S: I can’t really remember to be honest I remember he was very good at just getting on with it he’s probably the best person maybe I’ve met at just like taking the brief I’m running again all over
E: yeah very lucky
S: he was like he’s very much chasing us for feedback rather than ask feedback you’re chasing off and he was like hassling me to give him more work or better to find goals and feedback which is great and very I’ve never had that with anyone else ever since he was very lucky and I’m gonna talk a bit more about employing people a bit later good because while we got very lucky with him we weren’t so lucky with some other stuff we did and the other ways we went about recruiting that was a first step not spending much money and this was when we got some really good feedback this a good idea thinking back maybe the, I don’t think he was biased with his research but thinking back the way we structured it would have been would have been good for him to be bias because we’re basically asking him is this a good idea if it is a good idea we’ll give you a full-time job so you know he wants to come up with the answer that yes it is a good idea but I don’t think even like he’s not that sort of person but that’s probably another thing we were quite lucky about so then we went and we decided to build a cheap prototype of this comparison website I have a computer science background but I’m not very good at web development which is what this was so we went and we found a team in India who had built it for us we went on all the freelancing website yeah put up a job description of the project and eventually hired someone and I’ve written down what it was in pounds it was one thousand two hundred and twenty three pounds for this fully working website
E: that sounds pretty reasonable
S: and they built it there’s a picture of it pictures of the end result they made on the blog which I’ll link to in the show notes and it worked it looked really bad but it worked at the time we own the prototype we got a proof of concept yes something that we could build on later next step was we then went out we found a team of western designers a team from America who would then give us do all kind of like the user interface and stuff like that and create something that looks really good and paid about two thousand pounds for that
E: that’s interesting the price difference
E: so we paid more for the design which didn’t include any implementation of the design just the design itself for the prototype which as you can probably imagine is a mistake
E: yeah I was about to say did you plan any of this did you have a budget of how much you wanted to spend on the prototype and how much she wanted to spend on the design the user interface was this just the best deal you could get at the time
S: I think at this point everything is kind of on track for a successful business yeah so we haven’t spent much money we’ve invested in the look and the user interface which is very important yes and we had a working prototype yes where we probably fell down later was that we should have when we decided we were going to turn it into a proper business website we should have then scrap that original prototype altogether hired a much better team for a lot more money to build it into something that looked like our design that we wanted
E: with that team do both the technical side and design user face side
S: so they probably work with the designers they’d have people who were able to do that what instead of we tried to do it was we tried to mold the prototype we had into looking like the design that we had
E: sounds quite difficult
S: and maybe it could have worked but a few things happened which I’ll come to in a bit so at this point we have an ugly prototype that worked and we have pictures of what the finished product will look like yes which is basically to prove the concept for the product the other thing we then put together was a business plan a business case for for what were you doing
E: for potential clients to basically get approval from their CEO or whatever
S: yeah and so what we what we thought was probably a bit naively was that the finance world is a very who companies will work with is strict and they won’t work with a random startup run by 22 or 23 year old kind of working out their bedroom so what we thought was to give us credibility we would team up with a much bigger company one who already had relationships with the people we were then going to be selling the product to
E: that makes sense
S: I think if I was going to do again I’d go to another direction where we’d focus on building getting all the clients to users and then once those users then getting money out of advertisers or other people would be quite straightforward showing that we and said it basically tried to get buy-in by the industry first before getting users yes whereas the better way to do around I think would be to get the users first and then get buy-in from the industry
E: yes because the industry wants to know how many users you’ve got to be able to then invest yeah they’re using and it works
S: yeah we had no um we had no kind of negotiating standpoint I think also we fought that the value of the idea was worth more than it was so really like in terms of negotiating could deal with the people we didn’t really have very much we just had as I said prototype and idea and design of what we really like yeah and the business plan I think that while that was a mistake it wasn’t it wasn’t a big one we could have made it work this route and having a partner like that would work well another reason we wanted it was we want him to give us money to fund the development and building it because you know we haven’t spent very much money in that moment we wanted them to give us a few hundred thousand pounds say in order to turn it into this awesome awesome bit of kit whereas and that’s fine right that’s fine especially if we have other business is going on but we’re making money it is a good use of my time well getting by and early on with people willing to put their money where their mouth is is a really good indication that it’s going to work out we’re spending time on say at this point haven’t particularly made too many mistakes yeah you can kind of see the momentum is building for a few other things going wrong so there we were I say we had this we wanted to go to a few talked to different potential partners people who we could do a joint venture with so we put together this huge business plan it was 69 pages with a few extra additional addendums on the side it was also we spent more time on the business plan than we did on anything else
E: Wow
S: We spent a month to two months full time with me and Brandon plus we hired a bunch of interns as well to work on it we really like knocked out because we fought we’re young I was 23 at this point Brandon 22 we’re gonna be pitching to these old men who were CEO he’s a financial side over for well and they’re gonna be very skeptical about 21 22 yet credible we wanted to blow them out the water with with everything we were offering them give him a really good deal give him look the part all that kind of stuff yeah and we thought doing a really good business plan was part of that we do that so at this point we again haven’t spent much money in terms with of this something I really found out was that people liked the idea of working for a start-up even if it’s just me running it like okay it would always amaze me that like I’ve decided to call my business a startup and people are willing to come along and work for it for almost nothing
E: it doesn’t matter how good your idea is or what you’re like in the boss it’s just something about that term if you want it on their CV and they feel that they want to give their time and support you
S: yeah and some reason they were creating my startup that’s had 2,000 pounds investment with a startup that’s like in Silicon Valley that’s had like a million and everything that Google but that’s kind of on the same wavelength for some reason
E: yeah it’s obviously not
S: right because anyone could go do what we did
E: well no, I think you’re underestimating how hard is to start up a startup and there’s a lot of risk and courage creativity around creating a start-up which you have in abundance and I think these people that are interning they would probably like to have some of that I want a piece of it I think that’s attractive
S: maybe I mean I think it’s the unusualness that is useful and I’m not saying it’s a bad deal for them I’m sure having this startup on their CV it does have the employees not gonna know it’s just little old me yeah not knowing anything fumbling around but yeah so that’s what that’s what we did so me at this point we haven’t spent much money so I don’t know exactly how much but we’re kind of probably less than five thousand pounds all in so far at this point maybe less than that
E: so you spent money on the prototype and you’ve got some staff is there anything else in that five thousand
S: I don’t think we had the office yet I came in the office came to the office was kind of timed to happen
E: when you got investment
S: if we got some initial interest from investors from the partners yeah so we kind of went to them we didn’t tell them we didn’t have an office remember our first meeting we went along it was me and Brandon I was petrified nervous I had I drank like three espressos beforehand because I’ve written a book that zhudi warriors would drink coffee before going into battle because they’d give them courage
E: did you feel like you were going into battle
S: Yeah I did and that kind of nervousness around you know boardroom and these important people and stuff like that is something that still scares you today and well it’s something that I’ve worked very hard on over the years yeah which I’ve talked about over the years look on the comfort zone podcast for what I will talk about a bit more about that so we went in and we blew their socks off and they were really impressed by us everything like everything we had was much more than they anticipated that we would have
E: fantastic
S: and I think at the time and maybe still now there was for about there’s all you there were all these young people making a lot of money with clever ideas in tech yes and these men in there who’d been working in finance since like the 70s or 80s might be earlier I didn’t really understand computers and Internet and all this kind of stuff it was a bit of a voodoo but there’s obviously a lot of money to be made in it so us coming in I think in some ways being young actually helped us a little bit because oh they’re young enough to know all about this stuff and then we had the credibility of like look at all these amazing business plans look at all the work we did and the market research look at this prototype that’s working look at the designs for how it’s going to look in the future all we want from you is a is a bit of money keeps going your name to attach when we go into meetings and then you’ll get 50% of everything and I think that’s basically the deal we offered them I can’t remember exactly and I probably can’t tell you exactly what it was anyway and it worked really well so did we left we were buzzing absolutely buzzing this is gonna happen and this is when we started scaling up and we started trying to turn it into we’ve got the proof of concept we’ve got the promise of a buy-in
E: how exciting
S: How exciting so we left that meeting with the next step was we would put together a header turns like a one-page sheet laying out the details of the deal
E: do you have any idea how to approach that
S: a little bit so what we did is we left we went back to the back to my bedroom where we were running the business from and we said okay we need credibility we need a team we need to turn these prototype in this dog this design into an actual working website and we need to put together this deal with this company and we knew that they would be doing more due diligence on into us than just that initial meeting so that is when we when and we’ve rented an office in office in Broadgate Tower which is a skyscraper just on the edge of the shortest triangle which is the Silicon Valley of London the silicon roundabout around that sort of area but also in the city which is where all the finances that was in this kind of cross over geographically where tech financed startups are it was also relatively cheap this was not that long after the financial crash so it was a lot of empty office space in London and so we I think we cost us about 1,500 a month all in for on the twelfth floor of this skyscraper an office for six people so quite a good deal and we got the first month free I gotta put it on I put all my cash back credit cards so I was getting a little bit back
E: and also really helps with your credibility now you’ve got an address you’re in the right place you could have client meetings there all of that and we can
S: when hiring people we got somewhere for them to work yes rather than just you know meet up at coffee shops and places like that we did that you know we get branded onto a proper contract so but how do you do all that stuff so we went out and we found a lawyer and you would help us help us put together the heads of terms do all the employee contracts that so at this point we we chucked quite a lot of energy at the project what
E: sounds really exciting
S: sound very exciting and we’ve got the initial yes yeah so this is where works off spending start to wrap up and the first this is where the biggest mistake to be explained one of the biggest mistakes was that we tried to fit that prototype into the design yeah the Indian team who built it to begin with had disappeared yeah they just stopped replying to emails and so we couldn’t get em to make the changes so we took a group of developers in-house and started to try and develop change their code so it would fit
E: rather than start from scratch again
S: which if anyone has any experience with software development is a really bad idea it would have been much better for us to start from scratch yes and
E: taking the brief of what worked with the prototype but starting from scratch
S: and so we ended up spending quite a lot of money on and time and time on developers and stuff like that we hired some quite expensive developers that we probably couldn’t afford as well this was a little bit later after we realized we weren’t getting anywhere with this
E: did you find these developers the similar way they found did you go on upwork and freelancing websites here
S: we did some job posting I also you know contacted a couple universities if anyone’s there I recently graduated done my master’s in computer science and so I contacted people from my degree course if anyone were was around yeah I’m willing to work on it and I put together this motley collection of people all of whom had their strengths but when put together didn’t really work at all and we were kind of hiring very ad hoc instead of hiring specific skills so for instance we were creating web app I know my course I did the course we didn’t learn anything really about creating web apps we learn a lot about the kind of algorithms and yeah and building software that you install on your computer like Microsoft Word not something you go onto on a website yeah so why did I go ahead and buy a bunch of software developers who had graduated from the same courses as me and did the same training because I was like we can all learn it not so easy right so we were doing this working quite hard to get something to build our value with would decide with the partner that we were working with yeah so we did that, put together our head to terms took them to the partner and this is where what I’m calling like the cycle of contracts began I thought we’d be able to crack our contract within like a couple of weeks and have something ready to go that’s not what happened
E: that’s very optimistic
S: yeah I thought we’d give him something to go yeah that looks fine and sign it that’s definitely not what happened
E: that’s not how business works
S: they took it and they were like that looks alright our lawyers will look at it the lawyers came back made a hundred and one changes they gave it to us I took it to our lawyer and I was like no they’re basically like saying they own your soul yes so I’d go change a bunch of things send it back and we had this long process with lots of middlemen which just went back and forth
E: well there’s a whole industry with people’s jobs relying on just making small changes to contrast one of my best friends from university does that well and
S: and I think that I had quite naive idea of what contracts were at the time I thought of what was in a contract is what happens
E: no it’s not
S: which is not the case at all really contractor only is enforceable as you want to enforce them yes so if there’s something in there that you know you would never go to court over then it doesn’t matter that it’s you know or not they say they can have a contractual obligation it may be for something but if you’re not going to enforce it then it kind of doesn’t matter
E: yeah and in that case it satisfies your kind of clients legal teams company policy but it doesn’t really affect you
S: so we went back and forth back and forth eventually got heads of terms done then we’re not to the actual contract which went back and forth back and forth so this was all going on cost us a lot of money by the way lawyers very expensive yes you know you’re talking 200 pounds plus an hour yeah is it for the cheapest every time there’s a new range of amendments that’s a few hours work yes so that’s getting expensive on the other end of the spectrum we’ve got the development work wasn’t going very well we eventually fitted our kind of square prototype into the circle peg of the design and it didn’t look right because it didn’t we put this quite a clunky thing together that didn’t really work
E: was it working
S: it was working but in some ways it was no better than the original prototype because the design didn’t look good once we translated it into this prototype design and we were spending a lot of money and we got to this point where we were spending about 10,000 pounds a month on this and this hadn’t got any investment by the way so and we won’t even ask for that much investment and you know we could have thought we couldn’t release a prototype if we couldn’t start getting customers until the lease agreement had been sorted
E: you’re in this is not very nice place where you’re throwing all this money at something that might not even come off
S: and there wasn’t really like an end in sight either so how long was this contract gonna take me now I did and every round of amendments sours the blood a little bit more
E: and it’s costing you
S: its costing me it’s costing them as well listen and then you know they get and then they get their their programmers to come look at what we were doing and their feedback is it’s not looking very good and yeah it was it was just was enough time it wasn’t it was a really tough time we worked very hard kind of not in the right right ways I think there was there was a later meeting which I knew was coming up where we had to demonstrate the website and the progress we did on it and a week before I looked at what we had done on it what we had spent the last over six months so working on I was like we can’t show this this is terrible oh no like this is this is this is going to be more harm than good to show it so a week before I started again from scratch and I built the whole thing in a totally different platform so what we looked at was much better in a week than all the work we’d put onto for the previous six months before
E: are you completely insane
S: I was well I did like 20 hour days for a week
E: on your own
S: on my own
E: what did the rest of your team think of it or did they not really have any say
S: well one they didn’t have any say and two when they saw the finished product they were really impressed I said what took we took it to them and they were like well this is great but two weeks ago it looked completely different like what is going on and I was like you know all the back end was kind of there and you know but like the plug ins and blah blah they kind of bought it kind of didn’t at this point and weren’t really trusting us anyway so that that is a story like kind of demonstrates just how ridiculous this got that we’d spent six months 30,000 pounds or so building this thing and then just got rid of it all start again from scratch
E: how involved were you in the details of what the developers were doing that you hired because I mean you made a point at the beginning that you all kind of had the same experience but do you think you learn a huge amount about developing and like the design side through the six months
S: yeah definitely and you know it’s not like they were working on their I’m not saying they were rubbish
E: no, what I’m saying is you it was a good thing you had to go through
S: I was working on it just as hard as then yeah doing programming myself yeah for that six months and the problem was we were trying to work with technology we didn’t understand yes to change something someone else had programmed and had all the flaws and quirks of that into a design that didn’t really fit the the base we were using and so and that was the problem and so it was built on a framework we didn’t understand so when I through it all out I got rid of that framework altogether I moved on to stuff I did understand and and I didn’t bother doing a design I just used a design that’s kind of built in with the stuff we were using so I used my you something called Twitter bootstrap which is a very easy way it’s it’s where Twitter the team in Twitter have gone ahead and they built kind of templates for how a website should look with perfect functionality and usability and the text sizing spacing and all that kind of stuff and so I just went and used all of that and it looks a lot better than what we’ve done ourselves do you know you know what it’s like we’re like a font it’s just like the wrong song you know you know what it looks good even if you can’t the spacing just looks a little bit off you know what is a good website and you know what isn’t
E: do you think if you had done that at the beginning of the six months so when you hired all these developers and if you started again with them you would have created a better end product or do you think it would have been about the same because actually during that six months you all went through quite a learning curve and it wasn’t until the two weeks before the week before the meeting that you could actually have created a product packet
S: yeah that’s an interesting question because if I knew now it definitely would have been better for us to starting from scratch with technology that we all understood yeah that is a no-brainer
E: but it still would have been a big learning curve
S: there would have been a big learning curve and none of us were web developers it would have been better to find people who actually have the skills who were already familiar with the same technology to work on it like that
E: it just sounds like with the people you had the time you had the decisions that you made you made the best of a tough situation and you saved the day
S: well I don’t know about that
E: I know you wouldn’t say that
S: thank you very much that’s why I married you so here we were we weren’t getting anywhere with our contracts and you know I’m reporting as well to my business partners they’re saying you’re spending ten grand a month where we are how and bear in mind our business plan wasn’t that ambitious anyway with how much money we make the more we’re spending the less viable is this is looking so we had a kind of a crisis meeting what are we going to do now and we had been approached by an investor basically I had a crisis meeting as well with our lawyers saying look I’m not sure what to do here we’re burning through cash
E: yeah we’re hemorrhaging it yeah
S: in order to get this to something we think is good enough to release it to the public and start bringing in revenue we probably need another fifty thousand hundred thousand pounds so had that and had the same kind of crisis talk with my business partners along with saying that the people we’re looking to do a joint venture with this is looking like it’s not going to work out like it’s we’re still working towards this but
E: it’s not gonna happen anytime soon
S: it’s not gonna happen soon we keep hitting more stumbling blocks and we don’t want to spend another however many thousand on lawyer fees for this so our lawyers were like well we know a bunch of people investors who might be interested should we put you in touch with them which they did very nice of them and my business partners are like well why don’t we look into selling the concept on what we got already yeah so we ended up with these two two options that we could take take an investment and then commit to it probably another six months before there was something ready that we could release and then it would probably be another three four years before it was at a seven-figure sale position seven or eight figure, something that was worth more money and I think by this point we had enough proof of concept to put in another three or four years and it it was a very real possibility that it would be worth seven or eight figures at that point maybe not not a hundred percent impossibility but it was like that was like it was the most likely result if we got it to where we wanted it to be would be it’d be worth a lot of money
E: yes that’s quite an exciting option
S: that’s an exciting option the other option was we were pretty sure that people would want to buy it, we’re pretty sure that the concept was still very popular with the people we were doing the joint venture with yeah and we’re pretty confident they if we gave them the option and deciding to be working out why don’t you just buy it and do it yourselves
E: yeah you thought they might bite
S: so we had an investor come round inspect olur office chat to us and he kind of said yes I will invest with you we didn’t get as far as like heads to terms or anything like that
E: yeah that’s what you wanted you wanted a positive response
S: both options were very real but the problem was and one of the reasons why I’m where I am today is that I had by this time realized that I didn’t really enjoy working on a start-up
E: yeah I was waiting for you to say that just because the particular with the first option of working on it for another three years I could imagine where your head was at you did not want to be doing what you how hard you’ve been working as in the hours all the stresses around responsible for people’s pay and managing you didn’t want to commit yourself to another three years of that
S: I think what people don’t really understand is how much work there is if you’re running a business like that
E: yeah
S: because you’ve got to be especially the way I was doing it was you got to be there before everyone you know I’ve got a key I’m unlocking your office for your morning I’m the last one to leave at night I’ve got to sort out all the legal stuff their contracts all that kind of thing makes sure that people are getting paid on time I’ve got to get the money into the business in order to pay them I’ve then got to be the chief developer all that kind of stuff I think gotta be the head of HR I’ve got to be hiring and firing people and negotiating terms yeah doing all that sort of stuff I think that in that period I’ve I aged more than any other period of my life just like the final six months of 2012 I went from looking fresh and young looking like an adult
E: or you can say you grew up
S: maybe
E: you looked too fresh-faced you weren’t credible enough
S: I was very fresh-faced when I started I wasn’t so fresh-faced by the end and like it’s basically it was stress I was very it was I talk a bit in some of the other podcasts about chronic versus acute stress yes about how stress that is always there is really bad for you and this was definitely chronic stress that wasn’t very good for me
E: could you sleep at night was it that kind of stress
S: I don’t even remember but probably not it was really stressful and remember I didn’t really know what an ETF was I don’t know why people want this product
E: you talked before about the naivety of starting a business and the positive side of it
S: yeah but at this point I’m not enjoying the business I’m working really hard it’s burning through loads of money my money by the way it’s not like we had anyone else’s money
E: this is your head out hard-earned cash
S: I’m 22 and I’m spending thousands of pounds of my own money a month on something I’m hating
E: well don’t you always say with these startup businesses if you had any idea how much went into setting up the business you would never do it but looking back on it but you always learn so much
S: yeah we can come to the lessons learned and the positive stuff in a minute but at the end of this little rant I’m having about how much how little fun I was running a business I didn’t enjoy was that I had decided that we would try and sell sell the business yes so we went to went to the partners do they want to buy it the other thing to remember is we had a few employees at this stage so I didn’t wanna just you know I wanted to look after them as well and buy another company buying the business they would then take on those employees yes and that’s effectively what happened so we went we proposed this they said yes in principle let’s agree on a price and we want to like do some due diligence on your code and things like that
E: sounds fair
S: sounds fair what else I think we we agreed this maybe like a week or two into December I’ll probably have the day in my notes let me look I think ninth of December is ringing a bell for one we promote we said this to them and the business was all finished and sold before Christmas and how did we do it so quickly and it’s and you think that why is a joint-venture different to contract for the sale of the business and the reason is is that we basically agreed to most things immediately with the contract because this was the end of a relationship not beginning of one the exact details of line by line on a contract matter a lot less to me I can’t remember how much we sold it for it it was enough to make a little bit of money but not not a huge amount yeah we covered all our expenses and made a bit of money and we had like some future earnings built in there as well but it wasn’t enough they would be worth either of our points either us or the business to go to court over a slight breach in this contract yeah and this was the end of our relationship so they were taking it on they can do what they want with it we just have to disappear and not compete with them
E: yeah both sides were happy with that
S: so the lawyers had a little fight over it I then went and sat down in an office with the head of legal we got our red pens out went through the contract and just agreed and the changes we were going to make and we both agreed that we would not listen to our lawyers and just make these changes and then sign it yeah and and that’s what we did and it was very refreshing they took on they took on our staff who got pay rises out of it which was good for them they took over all the code and stuff like that we had a no compete and then went our separate ways and that was a very very happy Christmas
E: yeah that sounds great after the stresses leading up to the high stakes choice and it sounds like a really good result
S: and I think that’s why in the beginning I said on paper this sounds like a real success story yes ran a business for a very short amount of time really less than a year sold it made a profit learnt an absolute ton that sounds great but we were lucky we were lucky that they were willing to buy the business if we’d had to shut it down it wouldn’t have been so great we’d have lost a load of money
E: yeah, a lot of things could have gone catastrophically wrong and they didn’t
S: and they did yeah and I think the most important thing so I met some amazing people through it and I’m still in touch with a few other people who worked on that and they were all doing really well and a few of them earn much more than I do which is good
E: you should get Brandon on to do podcast
S: I’d like to he is definitely a character
E: I bet he’s got some really interesting stories yeah
S: yeah and I kind of thought at the time even if this fails it’s basically like paying for an education like an MBA will cost you 60 thousand pounds a year this was a year cost similar to less than a year but basically I think by the time you sold it we’d spend I’ve written down fifty three thousand pounds or something like that so less than an MBA and I probably learned more than a typical MBA person would so in that respect it worked out and I’m looking back I’m I’m glad it all happened because is great content for this podcast and um and I learned loads and it was interesting and it taught me that the type of business I want is a lifestyle business and not one where I’m managing a start-up or managing a really big company
E: what were some of you highlights in terms of the learning like was it around the management staff was it around like the management stuff or the technical stuff I see that you improve your development skills like what some of her
S: so the technical skills I did end up using again for other businesses so that was good but not not really that key the the main thing I think I probably took away over there was just how business actually works yeah like how the contracts work hiring the lawyers lawyers work how do you hire people what does an employment contract look like how much can you get away with doing yourself versus hiring an expensive professional to do for you
E: yeah and things like creating the business plan like how much needs to go into it
S: loads of good things really yeah I learn you know how do you had to get an office, how do you hire people I learned how to not hire people yeah I learned a bit about management and about how that is a big weakness of mine I’m not very good at managing people and that’s a big weakness of mine I mean I still need to improve its been one of my new year’s resolutions for the last ever since this business really that I want to get better at managing people learn a bit about the dangers of outsourcing to places like India you know what happens if they drop off the map you might get a really good deal to begin with, I learned the dangers of trying to amend other people’s code, I learned a lot about myself all sorts of things
E: that’s really good
S: so that was good stuff as well I think this has been the longest podcast so far and you said it’s gonna be really boring yeah so hopefully I haven’t bored you too much
E: I’ve actually been really excited about this
S: that’s what I thought because we didn’t really know each other at this point so it’s a story that you haven’t heard before
E: well technically we met in 2012
S: yeah yeah so we met at the beginning of this adventure yeah let’s leave it at that well thank you very much for listening I hope it hasn’t been too long and dull for you I’m gonna be doing some question and answer podcasts soon so if you have any questions please email them to me at hello Sam Priestley dot com you can ask whatever you want but I’m on the hunt for them and yeah as always if you have any feedback for me especially if you got what you want to leave a good review I’d really appreciate that as well goodbye