Why I dropped out to run a startup
I am a 21-year-old university drop out, who left my studies in April of 2019 to focus full time on building and scaling my start-up. As of this week, I will start to document my journey in building Livitay along with my co-founder and friend Jack and the rest of our skunkworks team. I am doing this for two reasons. Firstly; on this journey, a lot of young founders have asked questions about building a company and although I am no expert there can hopefully be some useful insights and learnings that can come from these weekly posts. And secondly, I am doing it for myself, to be able to look back and see where I have come from and document the ups and downs that are so often associated with startup life.
Perhaps it is best to make my initial blog an intro to where we are now and where we have come from.
The initial dinner: The real story is that Livitay dates back to early-2017. When Jack and I were interning in London, and the truth is that we hated it. It was our first real bit of ‘work experience’ and it just wasn’t what we had expected. I was spending most of my hours dragging and dropping files from folder to folder and making coffee’s and Jack was spending his days watching Mock the Week clips on youtube. Looking back it made sense, give the intern the jobs that no one else can be bothered to do (or in Jack’s case, don’t give him anything to do at all) but for us at 17 years old it was awful. We would often meet up after work near the office and it was one such evening; that without trying to sound corny, changed our futures quite significantly. We visited Delfino Pizza, and as usual, were complaining to one another about our experiences that day and how we felt that we could do more. It was depressing for us, having become quite disheartened by how the corporate system worked and the future once we got on with our lives.
So that was it! Like so many other entrepreneurs that start businesses, they are the misfits, not able or wanting to become a small cog in a big wheel but rather a big cog in a small wheel (at least to start). We got chatting over our pizza’s and beer and decided that was it. We vowed to never work in a large office again (which we failed), but our heart was there and we were passionate… all we needed now was an idea! 💡
Finding an idea: Jack and I left London at the end of that week with a new spark of life about how we would build London’s next unicorn! 🦄
Like so many first time founders with just an idea, we decided that we didn’t want to share the idea with anyone else, because we were certain that someone would be struck by the pure brilliance of it and make a carbon copy (this seems so naïve now considering that the initial idea will play such a small part in the businesses future growth and success). Our first idea was incredible! At least in our minds. A marketplace connecting users on one side needing to travel from A → B with people already making that journey. A new, innovative and radical idea that was going to change how people got around - at least until Jack’s father told us that a business doing exactly that was founded in 2006 by the name of Bla Bla Car. One of France’s first unicorns 🤦
Idea found 🍾: It was a year later or so when Jack and I stumbled upon the idea that would be the initial Livitay App! Although typing this, it may seem as though we had a EUREKA moment that really wasn’t the case. One of the important lessons we learnt is that when looking for a business idea, you have to be in the right mindset. Pierre Omidyar (the founder of eBay), believes that being entrepreneurial is a muscle that must be trained like any other. Even whilst running eBay, he would write a new business idea down every day. It is more about training yourself to be very observational in your daily life, as to where the problems lie that have not been tackled before, or could be tackled in a new and radical way.
It was in London when Jack and I were looking for something to do one afternoon when the idea “struck us”. It was impossible to find something to do that isn’t going to the pub for a pint 🍻. Try it yourself, google ‘things to do London’ and everything is tailored to tourists. Who wants to visit the Tower of London or the London Eye in your 20's? So there it was away… we would build a platform that solved that one problem; to make it easier for millennials to find and book the great activities and experiences that London has to offer.
Off to university: I will give it to Jack and myself. We did this part right. Too often founders find an idea and believe that that’s it! The be-all and end-all of ideas, an idea so good that it will never change (hence not wanting to share it with anyone) But having spoken with founders with a lot more experience what we had, we were often told that you must focus on the problem and not the solution. The problem will often stay fixed but the way you solve that problem should be very iterative until you eventually find the holy grail of solutions that is your product-market fit. In September of 2017, Jack and I headed off to our respective universities with an idea and a very basic business plan with our first solution, a mobile app that displayed relevant activities for millennials in London to discover a book great activities.
The first line of code (finding Jamie): There was always one big problem with Jack and I wanting to make a mobile app. Neither of us were technical co-founders and we had never written a line of code in our lives. And that’s where Jamie comes in, our resident tech guru 👨💻 After a number of interviews with developers ranging from Development agencies that cost $$$ to students at our universities. Ultimately we decided on Jamie, an Exeter electrical engineering student in his 3rd year for 2 reasons: firstly it was far less expensive, (in cash) and secondly, he had smashed the dev-test we gave him and had shown a real willingness and ability to learn and what a brilliant decision that turned out to be.
Product Launch: So that was it. We had a small team and were ready to go build something amazing. Over the next few months, we brought on-board a UX/UI designer to help bring our wireframes to life (early designs for what the app would look like) and by February we had launched our MVP. The first day was amazing for us and we were all at an all-time high, to see something that was once just a speck in our mind’s eye come to fruition that people could actually interact with, was an incredible feeling and for us, a major milestone that we had finally crossed 🚀
Dropping out 👋: Not too long later, we started to push the initial marketing efforts. Having never launched or tried to scale an app let alone any sort of business, we were quite misguided, to say the least, on how we expected our product launch to go. Day 1 was great, we pushed a Linkedin post, put it on our social media’s and watched the initial downloads pour in (at least the first 200 or so). The problem is that this is by no means a scalable solution to acquire users. Day 2 rolls around and we have about 20 downloads and then 8 and then 3! We had ridden this massive high and now everything was coming crashing down - we briefly felt as though nobody would want to download and use our app. We quite quickly realised that that wasn’t true. We started to push downloads to our app using Facebook ad manager and google display adds on mobile. Things were looking up now, we had a cost per download of ~£0.80 and people liked the app and were moving through the conversion process from landing on the homepage to booking an activity.
Over the next couple of months, we did the same thing, study a little at university and work on Livitay on the side. We had always spoken about not staying until the end of our studies and this really came to a head in April of 2019. It was going into our final term and things were looking up for Livitay, our customer acquisition costs were relatively low and people who weren’t our mates were downloading the app. We were planning on going out for a small raise in the summer to fund future growth of the app and while discussing this, also spoke about the logistics of raising money whilst studying. We realised that if we really wanted to make Livitay a success, we would have to make sacrifices, and university was going to be one of our early victims. We were dealing with shareholders, a decent userbase, lawyers, accountants and businesses and we felt so much more inspired doing those things than our studies. So, nearing the end of April, we made the leap to leave our respective universities and focus full time on bringing the vision we had for Livitay to life!
Raising Money: Raising money is hard! Very hard, and we were drastically underprepared for what this would really entail. In our minds, who wouldn’t want to invest in such a groundbreaking and pioneering idea… right? 💸 This was by far the lowest point on my entrepreneurial journey thus far. Were those people right, had we thrown away degrees at top universities on just some naive dream. The start was great, we had some early investors that loved the concept and us as founders and we had around £100,000 in committed capital, but then it got hard. The weeks turned into months and we were not prepared for what it took to raise money. Today I am so grateful for this experience because we learned so much. 3 months in I was at a low point. I could not fall asleep until the early hours of the morning and during the day only wanted to sleep. We also pivoted the idea completely mid-way through our raise which really didn't help (see below). It took a real push in the final couple of months to get out of bed and proactively seek that final investment! I will do a blog post on my raise in more detail another time but in the end, we finally got there! We had raised the £250,000 💥
The Pivot: Halfway through our raise we came to the realisation that actually there were going to be some real challenges with scaling and monetising the Livitay app. That’s not to say it won’t be done, and I have no doubt that one day somebody will build a very valuable business addressing the same problem we were, but it was not going to be us. At one point in the summer, we sat down with the commercial director of a now-defunct company called Yplan (read more here about Yplan). They had a very similar business model to Livitay, raised $37.7mn in venture funding and then sold for ~$2mn. We needed to get to the bottom of what went wrong and what we could do differently - we were not going to relive their mistakes.
But as it turned out, perhaps some of those mistakes were unavoidable. Acquiring millennial customers in such a saturated market gets very expensive very quickly when wanting to scale, signing commercial partnerships in the space is “near impossible” and flaws in the monetisation model were some of the key concerns. It was true. The business model needed to change, and as entrepreneurs, you need to remain agile and with an ear to the ground. We listed and moved on, Livitay would be reborn! 👶
Livitay 2.0: On the journey that had been Livitay at the time, we had realised something. Companies were spending a lot on activities for their teams, and often with a big focus on wellbeing! Companies were wanting to book great wellbeing activities and experiences for their teams but the tech just hadn’t followed. In some cases, companies were spending hundreds of thousands of pounds on wellbeing but using email or in some cases blackboards to convey these. There had to be a better way. So that’s what we did, we repurposed our mobile app to a web app, using very similar code we then built a marketplace and a tracking feature that empowered companies to take better care of their employees and are now addressing that one problem. To strive for a healthier and more inspired workforce 🌱
Today: We are a team of 6 and growing! We brought on-board Rob, a comp-sci undergraduate at Exeter to aid in expediting development with Jamie, and Ross to establish our partnerships and supply on the marketplace. We have business users and things are looking positive. Off course there are the everyday ups and downs that are associated with running a startup, but as a team, we are excited for what the year ahead has in store for us 🤞