Month 1: The Beginning
The first month of the 12 startups in 12 months challenge is in the books. Here's what happened in month 1.
Hey there, I’m Ben, the founder of Mockernut Ventures! MV is a brand new holding company for all of my indie startup ideas. I’ll also say that this is my first full-length blog-style post in a very long time, probably since I had a Xanga (anyone remember that website?) back in 2004 or so.
Getting to the point of this post: I didn't announce this until now, but I've decided to take the "launch 12 startups in 12 months" challenge and July was my first month as a part of the challenge, so this post will cover what happened during July.
I’ll do follow-up posts each month to cover successes and failures from the previous month and previous startup idea until I have something that works, so be sure to subscribe if you’re interested in this kind of content.
Finding the Right Founder-Market-Lifestyle Fit
In mid July, I launched PrintSwarm.com, a crowdsourced 3d printing and delivery service that I had been thinking about building for some time. I had positive feedback from early customers post-launch, but after running the business for a few weeks and making a few sales, I came to the conclusion that it wasn't the right type of business for my ideal lifestyle. I know what you’re thinking: “You’re just going to throw that revenue away? Revenue is not that easy to come by, and you should keep working on the business!”
The revenue PrintSwarm did over the few weeks it was in operation.
Here’s the thing: I’m exceptionally lucky to have found a business that did revenue on day 1. That’s a bit like winning the lottery. At the same time, a lot of people in the startup space talk about having "founder market fit," and while this usual advice of working on something that you have intimate knowledge of is a clear advantage for any business you might be interested in starting, there's an even more important question to consider: "Will the business I'm interested in starting allow me to have the lifestyle I want?"
I’ll call this concept "founder-market-lifestyle fit" or FMLF (not to be confused with FML - life is going great, thank you). How do you know if you have FMLF? Well, you should first realize that there are no right answers, except for whatever is right for you. For example, if you don’t want a cofounder, don’t get one and don’t pay attention to the standard advice of “you must have a cofounder and VC funding to have a successful business.” That sort of advice is usually given by people that are VCs or have a vested interest in having you run a certain type of business, much like a slimy used car salesman wants to sell you a car and not a bicycle even if your commute to work is only a mile long. The truth is that this type of advice makes sense for certain types of businesses and founders and doesn’t for others: put simply, it’s entirely situational. So, instead of taking this kind of common advice as the law, ask yourself the following questions and think carefully about your answers to come to a conclusion:
Do you want to hire a team to support you, take on millions in VC funding, grow at 50%+ month-over-month (which is about what VCs will expect for an early stage startup - VCs are after growth and an extremely high ROI at the end of the day), and shoot for a multi-billion dollar exit? In other words, do you want to run a “high growth” company? My previous employer, DoorDash, and some of my previous colleagues - once they moved onto their own startups - did this very successfully and it was the right fit for them. It might be for you too.
How many employees do you want to have?
Do you want a cofounder? How many? What job functions should they have?
Do you want to run a business that deals mostly with the physical world or one that exists mostly on the internet? As a general rule, software-as-a-service companies are cheap to operate, whereas hardware companies are expensive and might require significant upfront capital - so this is an important question to ask yourself.
Can you support yourself living off your savings for multiple years? Even if you can, do you want to?
On a scale of passive to active income, recognizing that nothing is truly passive, where are you comfortable with your business being? (1 being almost completely passive and 10 requiring all of your time and energy)
What does success mean to you? Is it a multi-billion dollar exit, enough monthly income to support your lifestyle, or something in between?
Does the problem space of the business you want to start truly excite you? As the saying goes: "if it's not a fuck yes, it's a no." Excitement wears off in due time, but it’s always better to work on something you’re truly interested in from the beginning.
Now, when I asked myself all of these questions - and it wasn't quick, it took several months of contemplation, plus talking to more than 20 prospective co-founders about their ideas (some of them were great ideas that I liked and heavily considered working on, but none were a “fuck yes”), plus launching my first startup idea by myself to come to this conclusion - my honest answers were:
No to all parts of this question. I want to have a healthy growth rate that I set myself and hold myself and only myself accountable. At the end of the day, I don’t want to answer to anyone but my customers.
Zero. I would however consider hiring a few contractors as necessary, once the business takes off, in order to free up my own time.
No cofounders for similar reasons to #1.
Heavily internet and software based, and I want extremely high margins if I can get them (90%+ is the goal). It’s OK if there are some physical aspects to the business, for example warehousing software where businesses might use the software to help them with some physical task, but I don’t want to be in the logistics or “delivery of some physical item” business having spent most of my career working as a Software Engineer at those types of companies.
I’m comfortable supporting myself for a few years and actively want to do that instead of taking on investment to run the business. I find that when I spend my own money I’m much more careful about how it gets spent which should be an advantage in the early days of a startup where scrappiness and sensible allocation of capital is what is needed to survive.
3 out of 10 - heavily leaning towards passive income and profitability at the expense of growth. I love solving problems and making improvements to the product, talking to users, doing the early advertising/sales myself, building from scratch, as well as thinking through long term vision, but I also enjoy traveling and taking as much time off as I need to feel happy and the business needs to make space for that - not the other way around.
Enough income to support my lifestyle, no question. I would be a fool to turn down a billion dollar exit, but the real goal is to have a profitable business that produces $10K/month in net income while I sleep.
[This took me launching a product to answer it fully] Thinking about PrintSwarm after launching it: no, I’m not interested in continuing with it. It’s a very tough answer because I’m both very interested in and have in-depth knowledge about 3d printers which is why I started the business, but it turns out that many of the problems that need to be solved to get the business to scale would involve building something similar to DoorDash's driver matching software for customers to printers. I’ve already spent enough time working on this exact type of problem for 5 years of my life, plus an additional 2 years at another logistics company prior to DoorDash - frankly, I don’t want to spend another several years solving almost the exact same problem in a different industry. Lastly, there were some issues with the business model that I’ll outline below that caused me to decide to shift my focus away from this idea.
Trouble in Paradise
The private island that I definitely built PrintSwarm on.
When I got a few weeks into the PrintSwarm business, and after I had stayed up all night a few nights in a row handling print jobs for customers to get a better handle on if the product would work at scale, I realized that there were several issues with the business that could basically only be solved by hiring full time support agents and/or paying my lawyer hefty legal fees for airtight ToS terms and to deal with potential lawsuits. Here are some of the support and legal related concerns I came across with the business after handling a few orders myself (this is why it’s so important to use your own product):
Random printers on the marketplace may not work on occasion or have maintenance issues, causing delays or poor quality prints that disappoint customers.
Customers may send extremely complex 3d models to printers leading to cost ineffective prints and 24+ hour turnaround times even for a physically small model.
Delivery drivers may screw up the address and go to the wrong place, leading to increased support costs.
The wrong print may get handed over to the wrong driver if the printer owner is doing a lot of volume, again causing support costs to spike.
Customers/printers may demand (rightfully so, I would do the same) refunds or payments for all of the above issues, and I would oblige them, essentially forcing me to incur Stripe processing fees for $0 in revenue.
Customers may request to print illegal things like parts for guns, and printer owners may not realize what they're printing, then inadvertently and indirectly enable a murder when the customer puts the parts together and kills someone. This is an extreme scenario, but something along these lines could happen - a more common problem would be if someone were to print something that infringes copyright and then try to resell it or similar.
Ignoring all of these rather glaring legal and support problems, there was an even bigger issue at hand: the business had low to negative margins due to the complexity of producing and delivering physical goods (plus needing to pay the printer operator). Unfortunately, after A/B testing with different pricing packages and delivery guarantees, customers were not comfortable with the higher prices that would be necessary to offset the fees I would have to pay on each order.
There was also the issue of “turns out that this is the exact same problem I just spent 7 years of my life solving” that was a major factor in my decision to stop working on PrintSwarm.
This is the End, Beautiful Friends
Ok, not really. Although PrintSwarm is no longer a focus, I’m leaving the website online with some affiliate links to my favorite 3D printers in case the website ranks for a random keyword and anyone wants to buy a printer to get into the hobby.
It’s of no real concern that this first idea didn’t work out seeing as I have many more ideas in the pipe. I’m also convinced that if I keep launching products consistently, something is bound to work. In any case, I hope my thought process of why I would decide to shutter a business and what type of business I want to run helps other prospective founders with their decision-making processes.
Onto the next business idea and onto month 2 out of 12!