LESSONS LEARNT FROM A UK DIGITAL START UP 2007-2010

Yoosk entered the participative media market, enabling internet users to hold direct conversations with leaders. Its business model is to charge those leaders for helping them access targeted audiences and for managing the engagement process.

The story of Yoosk’s journey is told through newspaper

clippings. The lessons are in the form of related questions that we found ourselves trying to

answer, sometimes when it was too late.

1. Are you prepared to do what it takes to really enthuse your community?

New web communities need a rapid groundswell of enthusiastic support and volunteers willing to spend time on the project for free.

Our plan was to build a community of uber-users who would get the answers from public figures themselves.

We made the mistake of not focusing on the mobilisation of this community and helping them get directly involved. Instead, we employed freelance journalists in an attempt to speed things up .

We thought we’d kick start the Q and A process but actually we disempowered the community.

2. Do you really know enough about the industry you are about to enter?

We called ourselves a web start up, but actually that means very little. In fact, we found ourselves in the news industry and later the political communications industry.

We were outsiders and constantly having to import credibility and knowledge into the company.

Ultimately, lots of innovations are unsuccessful first time around. This is because it is not the idea but its implementation and acceptance that really count.

Knowledge of the terrain and being able to call on allies are huge advantages when fighting the battle for this acceptance.

Lesson 3: Are all of your team ready to adapt your product and business model and shift focus as necessary?

When you are learning so much about a new market, you need to constantly adjust your proposition in line with rapidly changing data on what customer are willing to pay for and the changes they think you should make to your product.

I don’t think many citizen journalism start-ups ever found a viable revenue model. In the end, I’m glad we didn’t focus on building a citizen journalist community and instead kept adapting our business model.

4. Are you building the right kind of team?

This may sound obvious but under constant pressure to develop the product or find revenue sources, it is easy to overlook the human resource management tasks that are necessary.

We worked with postgraduate journalism students at London City University who provided a great free resource to add content .

However, what we really needed to add to the team were developers who could help us iterate the technical platform much quicker and more cheaply. Every web start up needs in house technologists.

5. Do you know the purchasing process for your product?

By now we thought we had a strategy that was viable and we were developing widgets that could be placed on newspaper sites to manage Q and As between their readers and public figures.

However, it was proving very time consuming to work out who exactly to sell to: editors, a newspaper’s digital editor or the web manager?

Some products are ordered routinely without much scrutiny but this is not the case with innovative products .

Despite a lot of interest from clients our proposals were often passed around like a hot potato, or pushed to one side as too difficult.

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6. Are you communicating with absolute clarity both internally and externally exactly what your product does and what it is for?

This story, which refers to us as a ‘debate website’ just about sums up how much we were misunderstood.

The fact that it came after an interview with a member of staff made it all the more worrisome.

7. Do you have a sufficiently strong relationship with the implementation teams within partner organisations?

There’s a Vietnamese saying: Even travellers on the King’s Road have to pay at the village gates.

Successful partnerships depend on the relationship between the more junior implementation teams as much as the relationship between the decision-makers. The first partnership with a large media group showed that while we could sell our innovative concept to the group director of digital, we might still not be able to win over the editorial staff on each title. New tasks that comes down from on high often land on the desks of people who are hard pressed with their day jobs. Later in the year when the Foreign Secretary David Milliband told his team to work with us, I went all out to immediately build a relationship with the key implementers.

8. Are your seed funding proposals over-promising ?

The Building Democracy Innovation Award gave us 10k seed funding to run some ambitious projects with Parliament and a large council.

Unfortunately seed funding of this size is not enough to employ staff full time, so ultimately delivery had to be done with contractors while I pressed ahead trying to grow the business.

This never really worked for us and I found that I had been over optimistic about what we could achieve. The end result was that these projects were low impact and took far too long to implement.

9.Are you pitching rather than doing product development consultations?

A good opener for a cold call is: “I work in xxxx- do have you a few moments for me to ask you some questions about your objectives this year so I can understand if there is any way I can develop our product so it is really useful for you?”

This application of Yoosk, which builds intercultural dialogue, came out of just such a conversation with the British Embassy.

10.Is this a growing market?

Investors like buoyant or growing markets and industries.

While it was nice that this Mashable article identified Yoosk as a solution to a very real problem in the newspaper industry, it also highlights the fact that we were trying to sell our services into businesses in turmoil and decline.

Around this time we found ourselves moving further and further into the government market, providing digital engagement service using Yoosk.

This sector was considered more lucrative by investors, although that later turned out to be a false assumption.

11: Are you located within socialising distance of your customers and clients?

I don’t mean because you need to schmooze them necessarily but because you need to constantly be having conversations about their needs and your products.

We became formally based in the West Midlands before winning this 1st stage investment and this decision would appear to have paid off.

However, we were some 2 hours from London and we needed to be as close to the centre of government as possible, since we were selling into government communications teams and sometimes the ministers themselves.

We needed to be at events and meet ups to really get to know key clients and we were just too physically far away.

12. Can you specify how your expenditure of investment funds will either convert pipeline sales to actual revenue or deliver a significantly better customer experience?

Most of our second lot of seed funding funding went on a 600 pound a day agency and the money took us some way towards a successful product design but then ran out.

Not having our own flexible internal coder who really understood our vision and had an equity stake constantly held us back. We were getting requests from potential clients for product improvements and iterations on the existing product while we were spending our money designing a new site with an agency.

We needed to tie expenditure far more to delivering what pipeline clients wanted rather than generic improvements.

13. Do you have ‘what if scenarios’ that enables you to plan a reaction to different partner behaviours?

We thought we had a great proposition. A sub-domain of Yoosk was embedded into a regional newspaper and councillors agreed to take part in Q and As from the paper’s readers.

All the newspaper’s journalists needed to do was pick up the interviews and follow up the stories.

The problem was that the workforce had just been halved and those who remained were threatening to strike.

Our project was quietly sidelined but if we had been ready we could have reacted more effectively to the problem by inputting more of our own resources.

UK: home to the mother of all ParliamentsNumber of MPs who chose to take part in Yoosk’s open and direct dialogue between MPs and constituents: 50

Socialist Republic of Vietnam: single party stateNumber of MPs who chose to take part in Yoosk’s open and direct dialogue between MPs and constituents: 100

14. What is the right political, social or cultural context for your product?

15. Do you have a feature, a product or a business?

Features are ‘vitamins’- what customers consider good ways to spend their time.

Products are ‘painkillers’- they will pay for something that solves a real problem.

A business is a collection of products that generate enough revenue to support its costs, including salaries and product development.

We raised a third stage of investment- this time start up funding of over 100k- but as time went on, it became apparent we had a product which by itself was not enough to support a business.

16. Am I focusing too much on PR and not enough on sales?

Britain’s Best MP was a campaign we ran with the Independent newspaper. Nice idea but we were still focusing too much on getting publicity and growing a community, not generating revenues.

We had a model that worked and we knew public sector departments were willing to pay for it. At this stage we should have been focusing entirely on developing the B2B revenue generating side of the business.

Britain’s Best MP was an interesting idea but a distraction.

17. Can we really scale and achieve mass adoption or are are we always going to be a services company with proprietary software?

The Afghanistan project worked well: our widgets and apps were embedded very effectively in partner websites who supplied the audience for the Q and As.

But we realised that our product was not easily scaleable to tens of thousands of customers like the FCO .

Clients wanted too much advice and support and what we were actually doing was providing a service which happened to use our own software.

This was a whole new business model and there was clearly a need to rethink and look at other markets

18. Is creativity acting as a brake on our business?

I think we produced some very creative engagement campaigns.

However, that was not enough and in a media business it is easy for the desire to constantly create and innovate to pull you away from the hard commercial imperatives of winning contracts.

Finally, three summary questions:

1. Can you turn your idea into a product which addresses a problem that people will pay to solve?

2. Do you have the capacity to get in front of those people and convince them to buy it?

3. Do you have the cash and human talent to beat competitors who are also trying to do 1 and 2?

2011: Yoosk moves to a fully automated Q and A process and enters new marketsMore lessons to learn…..