28 June 2016
Originally posted in the Tech Pioneers Report 2016
When, in 2011, Tim Fung was preparing to move, he encountered a situation that we’ve all experienced. The job was a big one, with lots of parts: packing a life in one location and then lifting, transporting, unpacking, and assembling that life somewhere new. He found a friend with a truck and friends to help with the labour. The group spent the weekend transporting Tim’s life from one apartment to the next. The currency of choice in these situations, beer, was an ideal trade for most services rendered. For that friend with the moving van, filling weekends with favours for beer was leaving him emotionally and financially stretched.
What makes the story of this particular move—something we’ve all been through—worth telling? Because this move led Fung to become a founder. Fung and his co-founder Jono Lui were driven by the question “with so many people looking for work across Australia, why don’t we ever ask these people to help us with all of these types of jobs?”
The pair dug to the core of the problem. “The answer was ‘trust’. We didn’t have a simple way to connect with these people in a trusted system,” says Fung. The solution? Airtasker: an amazingly successful Australian tech venture connecting those seeking work with those in need of help.
“The answer was ‘trust’. We simply didn’t have a simple way to connect with these people in a trusted system.” Tim Fung, Co-founder of Airtasker
The most critical trait of a founder is the recognition of problems as opportunities, not simply inconveniences. Here the Airtasker crew isn’t alone. Cyan Ta’eed, a graphic designer who co-founded Envato in 2006, found that designers like her had limited access to the resources that they wanted to buy and sell. Further, she was frustrated by the state of marketplaces, which “were taking around 90% of the proceeds … meaning the creator of the work was getting a penance.”
With her co-founders, Ta’eed channelled these problems into Envato, a community of over six million people creating and purchasing custom content.
In 2012, admits Zoe Pointon, “OpenAgent was just an idea we were toying with after having experiences of extremely varied quality with real estate agents.” Pointon and Marta Higuera, co-founders, started asking around. Their problem was not unique. Although specific experiences ranged widely, for those selling a home, “there was no one place to find the necessary information.” The pair built OpenAgent to solve that problem.
Shaun Holthouse, founder of Catapult Sports, finds inspiration in seeking solutions to problems. “The idea of being contrarian and being original is energising,” he said, “it creates this feeling of boundless possibility and optimism.”
Founders with a problem and solution are eager to learn, and the search for product-market fit educates fast. “When we built Envato’s first product,” says Ta’eed, “we built in every bell and whistle without much testing.” She estimates that drove up the time and cash cost by a factor of four. Now, she prefers her team to “build and launch a really basic product and test, test, test.”
“The idea of being contrarian and being original is energising.” Shaun Holthouse, Founder of Catapult Sports
This minimum viable product (MVP) approach allows startups to iterate fast, find their market, and grow into it. Focusing development on an MVP also frees Envato to “never assume we know what the customer wants,” having found it much more useful to “really listen to them before we build the bells and whistles.”
Jodie Fox, founder and CEO of Shoes of Prey, recommends to “do everything before you are ready,” and despite struggling with perfectionism, she “had to learn to create an MVP, to release things that were imperfect for testing, and about the process of iteration.”
This doesn’t mean that tech founders shy away from building. Rather, in Holthouse’s words, founders tend to be “defiantly creative” as they work towards “making something that wasn’t there before, that people thought wouldn’t work or couldn’t survive.”
Ta’eed shared that her founding team “worked long, long hours, but it became addictive because people were actually using this thing we built and we watched it gaining traction every day.” This is the builder’s high, a feedback loop in which working on a product drives new customers, and those customers fuel further work. Higuera feels similarly: “I get a lot of drive and pride from OpenAgent’s success to date and the fact that we are providing a great service to the public.”
“Something we didn’t realize was how much satisfaction we would get from bringing together a group of incredibly smart, committed and driven people.” Zoe Pointon, Co-founder of OpenAgent
In the best cases, that’s how things go. You create a great product, traction follows, and then you get to build a great team—your team. “As the company grows,” Airtasker’s Fung learned, “the greatest ‘leverage’ that the founders or the CEO can have is building a great team.” He continues that the founder’s role then shifts to “motivating [that team] with a strong vision and then creating a good culture and environment.”
Pointon shared that experience at OpenAgent: “We thought success would be measured in terms of market share or revenue. Something we didn’t realize was how much satisfaction we would get from bringing together a group of incredibly smart, committed and driven people.”
At Xero, co-founder and CEO Rod Drury has built a successful accounting platform allowing companies of all scales to access the latest and greatest cloud based accounting solutions. As his team grows he finds his focus shifting as well. “For me now [the most important thing] is that my team is successful, that they are doing meaningful work, changing the game, and achieving their career and financial goals.” That’s a long way from a founding team of just a few.
From building a product to building a team, there’s no break in the personal growth and education inherent to founding a startup.
At OpenAgent, Higuera feels that “Change and learning are also some of the best things about startup life and probably the reason why startups are so addictive.” Higuera and Pointon’s team “change all the time,” and that principle has become core to their product. “Learning and change is part of OpenAgent’s DNA and why we have been so successful.”
Drury of Xero embraces the cycles of challenge and growth, “With each mountain climbed, there is always a new one right behind it. Achieving those summits is addictive for entrepreneurs.”
“The tough stuff is as important as the fun stuff. It shapes you, grows you and makes you.” Peter Beck, Founder of Rocket Lab
The path of a founder may sound ideal: quit your job, solve a problem, build a team, and watch your empire grow. But that sort of trajectory is far from the norm. “You know that most startups die,” says Holthouse.
He continues, “to succeed, you are against the odds. You have to be an outlier.” Even as an outlier, success never comes overnight. The life of a founder is far from easy.
At Shoes of Prey, Fox and her team worked long, hard hours. Fox shares that she “would wake up, pull my computer onto my lap in bed and work until I was hungry and had to tear myself away.” She would “fall asleep the same way… computer on lap, screen on, desperate to get as much done as fast as possible.”
“With each mountain climbed, there is always a new one right behind it. Achieving those summits is addictive for entrepreneurs.” Rod Drury, Co-founder & CEO of Xero
The Envato founding team “didn’t take a day or evening off for about six months,” and Fung “built everything [at Airtasker] from scratch,” with a workload that “varied from doing product optimisation, creating marketing collateral and plans, building our PR presence, hiring new staff, and raising capital.”
But that was just on the product side. To help Airtasker grow, “my co-founder Jono and I also ended up completing a number of tasks - from late night KFC deliveries to retail shop fit outs!” In Tim’s words, building a startup is “like running a marathon but not knowing where the finish line is.”
Peter Beck, founder of Rocket Lab, would agree with the inherent difficulty, but reminds us that “the tough stuff is as important as the fun stuff. It shapes you, grows you and makes you.” He’s highlighting another characteristic of a successful founder—perseverance. He continues, “needless to say there are always hard times but it is best not to dwell on these.”
At OpenAgent, the early marathon days demanded perseverance. What else is there when you are building a client base without a product and a product without a client base? Higuera and Pointon “had no real estate agents on board. We simply went out there and got clients and backed ourselves to sign agents up on the go.” That’s a lot of work. They built a tech driven real estate company “with no real estate experience, no funding, no brand, and no sales experience.”
They both agree that the journey to OpenAgent was worth it. For Higuera, “being an entrepreneur is the hardest yet most rewarding thing I have ever done.”
That is in part because the difficulty pays off. Successful founders see gains both personal and financial. But that rewarding feeling that the OpenAgent founders feel is also because they’ve built something with a real, meaningful impact. For most of us, a home sale is a big life event. Pointon feels that “people deserve a great sale with the minimum fuss.” In some ways, starting OpenAgent was an easy decision for her: “When we first started OpenAgent, we knew this was a very big opportunity and we knew that we would be helping people through some of life’s biggest moments.”
“Do everything before you are ready.” Jodie Fox, Founder & CEO of Shoes of Prey
For Fung, Airtasker has become the trusted platform that he found lacking. His team has a user base of over half a million and has created over $40 million in jobs. That is real, meaningful impact.
“I also want to be running a business that is ethical and innovative and enhances the lives of our employees and community.” Cyan Ta’eed, Co-founder of Envato
“I feel like I am tremendously privileged to be in the position I am in,” says Ta’eed of Envato, “so while a core goal is to maintain a growing, profitable business, I also want to be running a business that is ethical and innovative and enhances the lives of our employees and community.” This reward, beyond the economics and products and metrics, is difficult to quantify. But the success hasn’t gone to Ta’eed’s head. She maintains a clear determination and focus on the problem that first started her down the founders’ path. For Ta’eed, the designers using Envato are “the talented ones”, and her team’s role is “to deliver that community of 6 million people to discover their talent and use their stuff.” Like the rest of the startups in this report, deliver they have.