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.
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Meet up: http:///www.meetup.com/bizoogo >> 15th May 2013
25 April 2013. ©2013 Bizoogo Limited
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