Then The Company Died — HereO, GetAlfred Learn from Failure (PartI)
Translated by Andrew
Would you persist or give up when the going gets tough? Could it be resolved easily just by transformation? How to set an appropriate stop loss point? Would everything go smoothly after transformation? A series of decisions to be made are trials for startup entrepreneurs.
This time, we invited two speakers who regained energy from failure: the co-founder of a crowdfunding platform HereO, Paul Wong, and the co-founder of GetAlfred, which just ended their service at the beginning of the year, Ronald Yu. Let’s hear their words of wisdom from their experience.
HereO Co-Founder: Startups Must Keep Bread on the Table
“To my opinion, there is not a absolute boundary between success and failure. One should neither define failure by lack of money or going bankrupt, nor success by having public offerings,” said Paul, the co-founder of crowdfunding platform HereO.
Paul’s team has just switched HereO to a subscription-based funding platform called Pressplay. He’s got his own take on startups, and shared his precious experience as the “Startup Trilogy”.
#Episode 1—Inception: We’ve gotta take the lead in this!
“I started HereO for a simple reason. My dad had started his own company back then, but the business began to get worse in the past 5 years. So I started thinking if there is a way to collect user responses in small scale to make sure the products, especially hardwares, do well in the market after molding. Therefore HereO was founded.”
Paul said that HereO was the third officially crowdfunding platform, and it was a bit different from the general platforms. Well-known companies such as flyingV and zeczec resemble Kickstarter. They cover projects from various areas like design, software, music, and hardware. HereO was the only one targeting art and cultural design. Paul is proficient in hardware while his partner who had just left Ogilvy & Mather is an adept in art and entertainment industry, so they took aim at the two areas.
“We achieved funding of 12 million dollars, which was a total success for music. Many music companies, including both independent and mainstream ones, came to HereO, which was quite an excellent accomplishment.”
“However we didn’t manage to satisfy all of our customers. More and more customers said that long-term issues or extensions couldn’t be handled through crowdfunding platforms. For example, after a music album is released, they would require organizing concerts afterwards.”
#Episode 2—The Darkest Days: Crowdfunding rush corners the market
Within the year of HereO, Paul feared for getting new customers; they chickened out even when proposers came to them.
Their main concern was that competitors were flooding in business. “Big corporations began to take part in crowdfunding in 2014. Besides flyingV and zeczec, WeBackers of Gamania, DIT Startup conducted by 5 game companies, Dream Cradle supported by 104 Job Bank are all newly developed platforms. flyingV branched out into specialized fundraising in music as FreeBird, which hit us hard and good. In 2015, some proposers began to do funding themselves through ‘crowdfunding modules’ on their official websites.”
“Another problem was the niche market. Our niche market wasn’t big enough, so many resources were cornered by our predecessors especially in music industry. We wouldn’t get cases of Mayday, or Jay Chou. Instead, we get cases of the rookies they just contract with, and wish to probe the market with. If it pulls off, they acknowledge our efforts; if not, it doesn’t concern them. It’s a refundable deal.”
Crowdfunding bubbles are serious particularly in hardware. It often ends with success in funding but failure in products. Coolest Cooler, who achieved funding of 1.328 millions USD, has just announced their difficulty in delivery in April, which is a bloody example. “Crowdfunding is a dream we chase together, and a dream with a bit of my color. As for the product, that I can wait. To be honest, such team attitude isn’t common in Taiwan.”
#Episode 3—Rise Again: Back to the drawing board
Transformation started from the very beginning. “Brand positioning, customer demand, and business model—these are the 3 things that needed re-evaluation. We set new goals: specific brand reconstruction, professional crew, resolving customer’s problems, developing subscription-based funding, focusing on target industry. We also recruited authors and artists onto our team because they are the ones capable of resolving problems in content industry, which is important in the Internet portion.”
HereO, or the new brand—PressPlay is targeting market of new media content.
“2016 is the starting year of new media content in Taiwan. There are more Youtubers springing up, and they are getting paid higher than the celebrities we think of in the traditional way. With such media nature, we adjusted our one-time funding to a long-term and continuing subscription, so we can recognize fans that are willing to pay and serve them, and elevate the originals. In the past, crowdfunding platforms served only as presale channels to music artists. ”
Finally, as Paul reminded, offline services are also substantial to support the team.
“I know there are many startups in Taiwan that only put focus on their online services and visitor flows. They think they have the opportunities to do something big if they get certain amount of hits online. It dawned on me that it doesn’t work this way after 2 years of HereO. We were once a company that achieved a million individual visitors online, but it didn’t go well as we had imagined.”
“The most important thing when starting a company is to keep bread on the table for the team, and make sure they can be fed. Otherwise, no one lasts long.”
中文版連結Cover photo: PanX