A startup idea called Maderight, is shutting down. Lets bring it back Rizq Ventures style!
Heres the orignal article by Kent Mori from Medium:
We were a software powered
apparel manufacturer that allowed companies to submit designs and manage
prototyping, production, and logistics through our web app. We were
accepted into both Y Combinator and StartX and received venture funding,
but after three years of operating we were unable to find
letting people know of our decision, my co-founders and I frequently
get asked what we learned from the process. I jotted down some key
lessons we took away from our experience.
1. Build a framework to document, test, and evaluate your hypotheses. Refer to it often.
the beginning, startups are simply a belief that a problem out in the
world needs solving and that someone is willing to pay for the solution.
This can be based on intuition or experiences, but they’re still
assumptions and hypotheses that must be verified.
we eventually adopted a system that worked for us, Maderight would have
benefited by implementing it from Day 1. We settled on the following 7
questions to steer our discussions:
- What are the assumptions/hypotheses we need to test to get us to product-market fit?
- How will we test our hypotheses (e.g. talking to customers, selling, landing page)?
- How and when will we evaluate the results?
- What needs to get built to conduct the test?
- What are we working on and why is it essential?
- What is our progress from last week / what are the results of any test?
- How can we move faster?
found that these questions helped pull us out of the day-to-day
“operator” mode and guide discussions around progress and priorities.
2. Instead of maximizing runway for length of time, maximize for the number of hypotheses you can test.
Maderight we were extremely conservative with our spending, something
we were proud of. We knew that the problem we were solving was large and
sales cycles were long, so we operated lean to maximize our runway.
the goal shouldn’t be to maximize runway, it’s to maximize the number
of hypotheses you can test with a given amount of money. To use a sports
analogy, maximizing quality shots on goal is more important than
increasing time of possession. Sometimes this may result in the same
outcome (especially with SAAS or bootstrapped companies), but as
technology expands into industries outside of pure software, it’s
dangerous to assume they’re automatically the same thing.
example, our customer’s biggest pain points were slow lead times and
product quality. We believed our technology would solve this, but
factories were not adopting our technology so we considered two options:
- Operating a “micro-factory” in China ourselves (<20 people)
out a service team in china (<5 people) to use our software, acting
as a manual step until we had the scale to force them to use it.
chose to build out the service team because we wanted to maximize our
runway. In retrospect, operating our own factory deserved a deeper look
since it would have put us closer to the root problems and allowed us to
test/iterate more solutions, faster.
#3 — Founder Led Sales. No Exception.
you reach product-market fit, sales must be led by a founder. We made
the mistake of bringing on a VP of sales too early and the double
mistake of taking too long to let them go (I feel like these mistakes
always go hand-in-hand).
I didn’t understand at the time is that sales before product-market fit
isn’t about revenue. It’s about talking to customers, problem
identification, and testing solutions. The sale is just a byproduct of a
are the only ones willing to get excited about a constantly changing
product. Plus, you’ll get the added benefit of understanding the type of
person that should be hired and a good performance benchmark when you
eventually do hire someone.
#4 — Avoid “let’s just do both” situations.
started Maderight as a service company so we could get customers from
day 1, start talking to them, and get a deeper understanding of their
problems. About a year into operating, we were acquiring customers
efficiently, they were paying us, and we were getting repeat orders. But
our attempts at automating the process just weren’t getting used.
on our 4th iteration we saw adoption. But we had a problem — while new
customers were adopting the technology, our existing clients still
wanted the “high-touch” service we were providing.
We had three choices:
- Option 1: Drop our existing customers (and corresponding revenue) and focus on the new product and customers.
- Option 2: Keep our existing customers and focus on operating as a service company.
- Option 3: Do both.
went with option 3, after all it was the “best of both worlds” and we
were afraid of losing our only revenue stream. Unfortunately, it split
time & resources and made both projects suffer. I believe we could
have found success in either case, we simply needed the courage to make a
hard decision and focus.
Maderight was the most rewarding professional experience of my life. We
got to manufacture hundreds of thousands of apparel products, work with
dozens of great companies, and build great friendships along the way.
Thank you to all the investors, mentors, and friends that helped us
throughout the journey. While the outcome was not what we envisioned,
the experience was without question worth it.