They also agreed to fully fund a major marketing campaign in the UK.
Under the franchise agreement, we'd only have to start making paybacks when our level of business hit a certain level of profitability.
Marketing funds were delayed for 'reasons' and we forged ahead using our own cash - a mixture of business and personal.
We soon had sufficient market penetration to hit the kickback level so we had to start making payments to our partner - but they were still dithering about the marketing money.
Then business began to slow and, to cut a long story short, marketing assistance was withdrawn and we discovered that the US partner was directly approaching our customer base, despite us having a territorial agreement.
The US partner company then adopted the stance that they were much bigger than us so we'd have no chance at litigation.
Now trading while insolvent, we had no option to fold the business and lay off about 8 staff.
We provided a budget and timeline. They gave us half the budget we requested (amounting to half the people) and still had us stick to the original timeline. We invested our money to hire others because we believed in the product and potential. They subsequently cut our budget by almost half again and we painfully managed to maintain our team.
When we were ready to start selling the product, they effectively used the hostile contract we had agreed to. By threatening to dissolve the company, they pulled the business away from us while trying to coax us into being employees instead of owners. We didn't come to an agreement and after a long and difficult process, the whole thing ended, we laid our team off, the software never saw the light of day, and our collective time and money was wasted.
Lessons: - Listen to your gut. - A hostile contract lays out how someone can screw you over. Ignore it at your own peril. - Don't optimize prematurely.
of course there's no "justice" you still lose a lot, but you don't give up for nothing, may end up with some compensation.
Now I hardly work at all, but am far more successful than I was while working 80 hour weeks. Making sure to be well rested keeps my mind clear and I make substantially better choices as a result.
Keeping time available to experience the real world outside of my immediate existence is tremendously beneficial. When I am on no artificial clock, I can experience how other people live their lives at their own pace, and what you can learn from them is often surprising.
Before you ask, I stay because the team is great and if we don't fail, the upside is early retirement in grand fashion level returns.
My mistake was to stick with plan A too long, I could have pulled the plug earlier but didn't. Usually I don't gamble, there I did.
And I realized that, despite wanting to start my own thing for years, I cope less with financial insecurities than I thought. A stead paycheck is nice, especially when it means that I don't have to care about every business aspect.
I also underestimated how hard the idea was to sell, and how active and well funded the competition was. I had one shot to get a first big enough customer to make it worthwhile. I missed. The pivot came too late. It was a possibility from day one so, so I pulled the plug on the whole thing in time, and more importantly in budget.
Not all niches, no matter how big, are created equal. I would try to either find something with raising tide or place where potential customers are actively searching and buying what you have to offer and will profit from it.
An example of of "bad" customer is someone who pays money for quantum healing or crystal healing. You could create a product that they'll buy, but that product is snake oil.
We explicitly determined one day a week to work on this. And kept it up for a while even after people got work. I was the first to get work and for a while (maybe 3-6 months) I was putting in 5 days on my day job and then 1 more on this. At some point I quit and formally gifted my share of assets to the other founders (it wasn't really much, we each put in like $100 at the start). I think it was fully wound up about a year later. Paid back most of a small arts grant we hadn't managed to spend to the NFP that gave it to us.
We realized that without that middle man installing and promoting our products, our sales would plummet to a unsustainable level.
No matter what new guizmo we could duck tape to the product.
Tbh what’s worked best is when I’ve been focussed. Doing many things at once has mostly been the root cause of businesses failing.
I have a thing and it mostly works, but it's not good enough for people to use, let alone to buy, and I'm not sure how to get it there. The more time passes, the more I move on mentally and emotionally.
I need to ship it, but I don't know how, so it's just in limbo now, and one day it may likely just be over. I'm not running out of cash or anything, I'm just not moving forward.
I basically gave away everything I was working on and how I was doing it on my website just for clicks and comments.
(This was 2000-2005, dashboard linux/dashpc).
I’ve been searching for a cofounder ever since.
Also, looking to buy businesses. Email me (profile).
2. B2B hardware and service (sell install all kinds of electronics)