It’s been just over a year since Bizoogo launched its crowdsourcing platform where individuals can “find or become a startup co-founder,” a very tempting proposition at a time where everyone and their granddad wants to be startup entrepreneurs. With this significant milestone met, we met up with Bizoogo founder Erez Nounou to gain an insight into what it is like setting up a startup and transforming it into a viable business in the current market.
Q. What is your personal definition of a startup company and has it changed from the day that you first decided to create Bizoogo?
For me, a startup is an early-stage company that’s more likely to fail than succeed. You can’t escape the fact that only 12% of first-time entrepreneurs survive, but of course I never for a second thought that I’d fall outside that band; I just didn’t realise how hard it was going to be.
Q. Given your definition of what a startup is, at what stage will Bizoogo transition from being a startup to an ordinary online business? Have you set any benchmarks, or is it simply a state of mind?
Once the odds change, and the rewards begin to outweigh the risk; that’s normally defined as being consistently cash-positive. We have benchmarks for member registrations and revenue, but obviously it’s the revenue that counts to a business and not vanity metrics or states of mind.
Q. The world is becoming increasingly more online focused and Bizoogo looks to match people through the Bizoogo website. How much value do you attribute to physical interactions, and can successful business relationships form without parties ever meeting?
The physical interaction is at the centre of what we do. It was always clear that the co-founder relationship, much like a real relationship, couldn’t develop and exist meaningfully or realistically online. Paul Graham of Y Combinator fame called it “marriage without f***ing”; such a committed and demanding relationship needs to be explored in person, where everything’s on show because a lot of time, money and responsibility is shared across the partnership. That’s not to say that leveraging online communication tools like Skype is impossible or unhelpful, it’s just that we’ve found that the physical events re-enforce the connections online, as you’d expect.
Q. With startups such as Bizoogo, where you are providing a service rather than selling a product, how can you mitigate the chances of a competing startup cashing in on your hard work by setting up an identical competing service?
Unfortunately you can’t. The onus is on the entrepreneur to take advantage of being a first-mover and to outperform via the quality of its service, responsiveness to feedback, and a willingness to consistently innovate and improve. That’s the fun – you’ve got to remain competitive and always keep moving.
Q. You started Bizoogo with a background that was neither technology nor internet related. If you could go back to your first day working on Bizoogo, what advice would you give yourself?
Don’t start-up in an industry you or your co-founders know nothing about. It takes time to wise up to how everything works, and until that point you’re constantly on the back-foot, increasingly your chances of failure. Bizoogo is all about collaborating with co-founders that have the technical skills you need to develop your business for that very reason. If the expertise isn’t in the founding partners, you should at least have a strong and experienced advisory board that can guide and mentor you along the way.
Q. Looking at environments such as Google Campus, one gets the impression that within the startup community founders, developers and engineers happily assist each other with their respective projects. Have you found this to be the case and have you benefited from working collaboratively with other startups?
I’ve found that collaboration works best at the grassroots level, at a time when people don’t have too much self-interest and are more willing to share and collaborate. Campus London, Club Workspace, Central Working and Tech Hub are awesome examples of “collaborative” workspaces but they’re largely made up of functioning teams that are getting on with their own objectives. There’s an amazing buzz and enthusiasm in that environment because of the nature of what’s going on, but it doesn’t always mean that everyone’s sharing away. I think that’s why our meetups have such a unique dynamic, because everyone’s so green but ambitious, and collaboration is very much on the agenda as a means of starting-up and moving forward.
Q. Following a number of very public and very expensive buyouts of young startups, Facebook’s purchase of Instagram comes to mind, people have begun to think that creating a startup is a quick way to make a lot of money. Do you feel that such buyouts strengthen or weaken the quality of startups coming to market?
They do both. We saw a similar thing in the 80’s with investment banking where a boom in the industry and earning potential pulled in the kind of talent that would ordinarily go into medicine or engineering; graduate and professional talent followed the cash. We’re now seeing the guys who’d ordinarily go into banking and management consultancy, go into startups, which is great for our talent pool and the quality of our innovation. On the other hand like you said, the ease and speed at which some startups raise and exit with massive sums of money (or made to look as though they have by the tech press), makes it seem like an easy ride and results in some delusional entrepreneurs and lazy innovation.
Q. In the future do you anticipate that Bizoogo will exist as a standalone service or do you envisage that it will merge with other services to provide an end to end service for startups?
We’ll have to wait and see. At the moment we’re working on developing partnerships across key startup services that will see startup founders connect and co-found businesses via our network, and move on to find the help they need to grow into sustainable businesses.
Q. In running Bizoogo you have developed an excellent working knowledge of the angel investment market. Are investors beginning to shy away from startups and if so, is the startup investment bubble beginning to burst?
There’s now more interest than ever as a result of the Government’s tax incentives under the Seed Enterprise Investment Scheme, which offers significant tax incentives to investors in seed-stage businesses. Together with a massive PR offensive, big spending in tech infrastructure, and necessity – over 1mn unemployed 16-24 year olds – I don’t think startups and entrepreneurship are going anywhere anytime soon. The truth is we’ve got a really young and inexperienced professional investor community who are still finding their feet and their risk-appetite; our start-ups are also catching up in quality and ambition. Everything’s tempered with much more caution over here. I think as the industry matures, we’ll see more success, and a recycling of exited entrepreneurs into the investor community as we’ve seen in the Valley; that’s only a good thing for the credibility of the industry in attracting even more talent and cash.
Like us: http://www.fb.com/bizoogo
Follow us: http://www.twitter.com/bizoogo
Meet up: http:///www.meetup.com/bizoogo >> 15th May 2013
25 April 2013. ©2013 Bizoogo Limited
Enjoy. Comment. Share :)