Last week Joseph Ajilore (Founder, Your Hidden Potential) interviewed me for his young entrepreneur blog. He asked me about how to be a successful entrepreneur, why I rejected multiple corporate job offers in favour of pursuing GroupSpaces full-time and who I find inspiring. Following a lot of great feedback we’ve both received on the interview, Joseph’s kindly allowed me to re-publish it for the readers of Freed From the Matrix.
Can you quickly give us some background information about yourself?
I’m a 24 year-old Internet entrepreneur, born and bred in Wimbledon, currently based in Oxford having completed a Mathematics degree at Oxford University in 2007. In addition to working on my startup GroupSpaces, I also write for The Gateway newspaper as their Entrepreneurship Columnist and train for my current sporting passion: triathlons.
So David, tell us about your company and what inspired you to start it?
GroupSpaces is an Oxford-based Web startup which takes the pain out of managing clubs, societies, associations and other real-world groups.
I started GroupSpaces in 2007 with my co-founder, Andy Young, based on our personal experiences on the committee of various clubs and societies at Oxford University.
We observed that every real-world group we came across was managing itself using a mash-up of disconnected tools and processes. This was really inefficient and meant these groups were spending an unnecessarily large amount of time on admin, distracting them from their group’s core purpose.
The status quo was a mailing list on Gmail or a Yahoo!/Google group, a membership database in Excel, events on a Facebook group, payments being collected by cheque or cash and a website which was time-consuming to update and disconnected from everything else.
Andy and I thought that it would be much quicker and easier to manage all these things from one place, which is what inspired us to start GroupSpaces.
What makes your business different from other competitors?
GroupSpaces’ main competitors are Excel spreadsheets, Cc email threads, cheques and some other Web applications solving one specific problem for groups e.g. Eventbrite for event management.
GroupSpaces differentiates by providing an intuitive, all-in-one Web-based solution for group management.
What role do you perform in your company?
We currently have a small team which means I perform many different roles. A typical week for me involves wearing several different hats such as user support, marketing, sales, finance and operations. I currently work on every area of the business except for coding the actual software which I leave to our brilliant team of developers.
How difficult was it getting funding for your business? Is there a right way for young entrepreneurs to get funding?
Prior to raising our angel funding, we had already built a prototype product, had a few hundred groups using it and were generating revenue so we had a fairly good ‘proof of concept’, something which angel investors often look for. We ended up receiving multiple offers of funding for our angel round and the one we took came via the Oxford Early Investments business angel network. It took us about 5 months from our first conversation with prospective investors to getting the money in the bank.
If you’re a first-time entrepreneur and you think that you are going to need to raise funding for your business, I would encourage you to start building relationships with potential investors as early as possible and ask them what they will be looking for you to achieve before they would be comfortable investing in you. This can vary a lot between different investors, countries and markets, so the best thing to do is to just start talking to potential investors.
David you’ve worked in some pretty big companies so far such as Lehman Brothers, JPMorgan and McKinsey. Why didn’t you go down that route and get yourself a safe, secure job?
Having done some courses and internships in the corporate world, it was crystal clear to me that being an entrepreneur was my best option. There were several strong reasons for this:
- I could do what I love and am passionate about every single day.
- I could have far more positive impact on the world by starting my own company and this was personally a very important factor when considering how I would spend years of my life.
- The long-term financial upside was greater if you are successful and I don’t think that it’s anywhere near as important to have money in your early twenties versus when you’re older and have a family etc.
- Andy and I were already underway working on GroupSpaces and were very excited about its potential so we definitely wanted to continue working on this to start with.
- I could spend every day doing what I thought and felt was most important. I didn’t have someone telling me differently.
- I’m not sure how safe and secure taking a job with Lehman Brothers would have been…
What are key ingredients that you think makes a successful entrepreneur?
Persistence, persistence and persistence. One of my favourite entrepreneurial books is Founders at Work by Jessica Livingston (Founding Partner, Y Combinator) – it’s composed of 32 short interviews with successful technology entrepreneurs such as Steve Wozniak (Apple), Max Levchin (PayPal) and Evan Williams (Blogger, Twitter). The book concludes with a quote from Ron Gruner, founder of Shareholder.com and Alliant Systems:
“The key to success, if you had to sum it up in one word, is persistence.”
Also from my personal experience both as an entrepreneur and interacting with hundreds of other entrepreneurs over the past few years, it’s clear that the ones who do the best are prepared to do anything and everything to make their companies successful and they don’t give up. Whether that means changing their initial idea, changing team members, raising more money, whatever is required, the most successful entrepreneurs don’t give up, they persist and keep persisting until success comes their way.
I asked Jessica about this quote a couple of years ago after I had first read the book and she said that it was a deliberate decision to end with this. From her experience at Y Combinator having invested in dozens of startups, it was clear to her that the ones with the most persistent founders were the ones which went on to succeed.
Do you feel that there are things which entrepreneurs are doing wrong to break into the entrepreneurial world?
I think anyone starting their first company should try to meet and build relationships with other entrepreneurs. This might mean relocating somewhere with a greater density of entrepreneurs but I believe this can be done in other places besides Silicon Valley. You just need to seek out a couple of other entrepreneurs who are slightly further down the line than you are and can share with you some of the lessons they learned and offer you advice on the challenges you are facing.
I also think peer pressure can be a big motivator for first-time entrepreneurs. Y Combinator companies benefit a lot from this – I remember Paul Graham saying that not screwing up at Demo Day in front of all your friends is a much bigger motivator than getting rich. Similarly if you can just find a couple of other young entrepreneurs at a similar stage to you, it will give you a significant sense of urgency to get shit done if you think their startup is progressing faster than yours.
Why do you think is so difficult for young entrepreneurs to get funding for their company? In the US there are tons of investment opportunities e.g. in Silicon Valley
There are a couple of ways of looking at this. On the one hand there are far more angel investors and venture capitalists in Silicon Valley than anywhere else in the world, but there are also far more startups there. Obviously this results in a lot more startups being funded in Silicon Valley than anywhere else but there are also quite a few active angel investors and venture capitalists throughout the UK, you just have to look a bit harder to find them.
I’m not in a good position to comment outside of the UK or Silicon Valley as I haven’t spent any time being an entrepreneur there, but certainly in the UK if you are a first-time entrepreneur, you should be able to draw up a shortlist of 10-15 investors who do deals at the size you are looking for. These lists of VC firms for UK-based startups and sources of angel financing are good starting points. If you put in the effort to network and get personally introduced to all these investors, get meetings, and still are not able to get funding, then your business is probably not far enough developed for the stage of financing you are trying to raise e.g. if you’re struggling to raise angel financing, you might still need to get more of a ‘proof of concept’ and if you’re struggling to raise your first round of Venture Capital then you probably don’t have enough early traction.
What are your hobbies?
When I’m not working on GroupSpaces, I enjoy working out, spending time with my girlfriend and heading to the occasional drum n bass rave.
In particular, I am a firm believer in ‘healthy body, healthy mind’. This old adage was in fact scientifically proven recently. A lot of people I speak to say that they are too busy to work out but I don’t believe that this is a healthy attitude. My mind functions faster when I’m at peak fitness and that means exercise is an essential part of my life. I make time to keep fit, even if this means sacrificing on sleep sometimes. In the summer I enjoy training for and racing triathlons and in the winter I tend to spend more time in the gym.
If you ever believe that you are too busy to work out, I would encourage you look at Barack Obama. The President of the United States is probably busier than you, even though you may be very busy. However, in a recent interview of Men’s Health magazine, Barack said:
“Most of my workouts have to come before my day starts. There’s always a trade-off between sleep and working out. Usually I get in about 45 minutes, six days a week. I’ll lift [weights] one day, do cardio the next. I wish I was getting a 90-minute workout.”
Who has been your greatest inspiration so far?
I find the most inspiration in people who are able to repeatedly apply themselves to a world-class level in multiple disciplines. As a mathematician, I often see patterns when I abstract parts of my and other people’s lives and I think the ingredients that make one successful in business, sport, politics, entertainment and most other fields are actually very similar.
Malcolm Gladwell’s book Outliers does a good job of explaining this – Gladwell claims that the key to success in any field is, to a large extent, a matter of practising a specific task for a total of around 10,000 hours. There are obviously other factors in play, but I would relate the point made back to my earlier point about persistence being the key driving factor of successful entrepreneurs.
Specific people who have inspired me in this way are:
- Arnold Schwarzenegger for becoming the best bodybuilder in the world then turning his hand to acting and becoming world-class at that and now building a fantastically successful career in politics, becoming Governor of California.
- Mark Zuckerberg for changing the way hundreds of millions of people understand their relationships with their friends. What particularly inspires me about what Mark has achieved is that Facebook isn’t so successful because he executed one idea really well. He has continually innovated and adapted his company to grow and succeed, all at such a young age.
- Marc Andreessen for starting two billion dollar companies (Netscape, Opsware), being on the way to having started a third (Ning, valued at $750M last round) and having now started his own venture capital firm, Andreessen Horowitz, which seems to be on the way to building a world-class portfolio.
If you had a chance to have a cup of coffee with anyone dead or alive, who would it be and why?
Winston Churchill. By all accounts his determination and data-driven approach to strategy were second to none. Some people laugh at books like Sun Tzu’s Art of War for Executives but I firmly believe that the characteristics of a successful leader in war are very similar to the characteristics of successful entrepreneurs. I’d love to experience Churchill first hand and compare with some of the most inspirational people I have met in my life so far.
Where do you see yourself in the next 5 years?
My primary focus is building GroupSpaces into a world-class company and I’m not really thinking beyond that at the moment. Long-term I’d like to probably do at least one more startup, write a book, travel the world and perhaps start a venture capital firm. We’ll see what happens.
Do you have any tips for aspiring entrepreneurs?
Before making important decisions, double check that both your heart and head are in agreement. If you aren’t already in regular contact with other entrepreneurs at a similar stage to you, go and find some – the peer support and peer pressure this will generate is really important. Once you’ve settled on your initial idea and founding team, focus on core and be the most persistent person you’ve ever met. Finally, I’ll offer a quote from Dharmesh Shah, founder of OnStartups: “The shortest piece of startup advice ever: GO!”