Real-Life Startup Post-Mortems [Part I]
We always hear about success stories, but can learn so much more from failure.
This is a 4-post series:
3x editions featuring 2 startups each
1x edition with research and my SXSW presentation
9 out of 10 startups don’t work out.
The 1 out 10 startups that do work we try to learn from:
perseverance, hard work, and doing things that don’t scale.
But the 9 out of 10 companies that didn’t work also had these characteristics
- so are they the right lessons?
Learn from the companies that didn’t work, so you don’t repeat the same mistakes.
Planes in WWII had bullet holes upon return from missions (red dots).
The WRONG interpretation is that these are the places getting hit and need more armor (= the success stories).
The CORRECT interpretation is that these are the places where hits were non-fatal so the other spots need additional armor (= the failures that we never hear from).👉 Want to share your startup story that didn’t work out?
Fill this out so everyone gets to learn from you.
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Here are the post-mortems of Aussie startups captured by their founders.
📰 Storipress Story: Lessons from Disrupting Media
Customer: Traditional media
Problem: They didn't make a lot of money from advertising as their data was fragmented across many systems
Solution: We vertically integrated their systems to combine all their data sources to power better ads.
Pivot?
Yes, we discovered that traditional publishers, while they needed help, were tough customers. They were often short on budget and hesitant to adopt new technology. So we made a strategic shift to focus on B2B company blogs instead - they had deeper pockets, more valuable data, and were more open to innovation — and also ran advertising.
Best success?
$750k+ sales first year of launch, and the capturing of awesome logos like Rippling, Eppo, IDEO, and Espresso Displays.
Top 3 Problems?
Traditional media is a PITA to sell to
Helping companies move their core systems was trickier than expected
We had a lot of investor politics
One reason it failed?
The initial product required a full shift of existing systems as we did not understand the technical work required (large).
Eventually, Storipress evolved into an integration rather than a full systems replacement.
If you were to solve again, how do it differently?
Focus on ease of adoption as priority number\
Hire for generalists
Your main lessons?
Balancing Short and Long-term Goals in ‘Trojan Horse’ Strategies is Challenging: Our focus on collecting data led us to miss flaws in our initial product and target customers.
All Founders Need Commercial Skills: Non-commercial co-founders slowed execution. External advisory is crucial if a founder lacks commercial expertise.
Startups Die from Suicide, not Murder.
Agility Reduction Creep is Dangerous: Prioritizing short-term goals weakened our long-term agility, slowing down our strategic pivot and limiting our ability to recover.
Pick investors who have experience in pre-seed.
The Most Important Requirement of a Highly Contrarian Thesis isn’t its Correctness: It’s whether others will see its correctness at scale within your investment horizon.
The market can remain irrational longer than you can stay solvent.
🍃 Mint - aged care (Founder - Sean Grealy SM20)
Customer: Aged care groups, supported 4000 families around Australia
Problem: Communication and feedback management between the (1) service provider, the (2) older or vulnerable person and (3) their families all whilst documenting high-quality service delivery and performance in line with aged care standards.
Solution: We had a communication social tool that documented the great services and living in a private feed for all parties. We captured feedback and complaints in a timely manner making them accessible, clear on their progress to resolution and in line with industry standards of how they were managed.
Pivot?
Yes, we started with in-home care and driven by the family then went to nursing homes and focused on lifestyle and high-quality service delivery.
Then one day whilst (living) in a nursing home rapid prototyping I realised complaints live in paper on desks and in boxes or local only spreadsheets and this causes complex frustration between parties.
The person who complained gets frustrated awaiting ‘acknowledgement’ and the provider gets frustrated they take so long to handle the complaint.
We made this instantly visible to any device with the internet and it could be ‘acknowledged’ immediately and then the loop closed with regulation and standards in mind.
Our unique insight into our growth was understanding how to onboard users and how many users it took to create an engaged network e.g. when a family member gave excited responses to a photo of service delivery this positively reinforced the staff to continue using the tool.
Best success?
4000 families actively on Mint.
Top 3 Problems?
Speed - Health is a complex space and people are slow movers
Competitors - Incumbents can easily pivot and announce they are building your product even if they take years people just take their word for it
Aged care has multiple stakeholders who need convincing and onboarding you are signing up to onboard essentially 3 complex user groups
One reason it failed?
Running out of money before we landed our painkiller.
We ran out of cash in 2020, our pipeline was fantastic in March then April we grew by 700 users and hit the market hard but in May providers went into panic and closed doors as people were dying from COVID outbreaks.
We couldn’t get into homes to onboard users, people paused spending to focus on saving lives and we didn’t have the resources to support the chasm in front of us needing to scale and evolve + millions in pipeline pausing overnight.
If you were to solve again, how do it differently?
Yes. I would have started with the feedback tool and now used a much better automation infrastructure to call existing healthcare tools and share that data with families directly.
The reason is our feedback tool was used by auditors in the royal commission and their responses about how easy it was to use were astounding.
Your main lessons?
Move faster than you think you need to
Always have 6-9 months runway planned
Start with smaller sale cycle customers mid-enterprise sales requires complex sales processes and knowledge and will kill you if the core business doesn’t support this expansion
Kill features faster and more dramatically
5. Do things that don’t scale I basically lived in nursing homes and all our unique insights came from being close to customers.