Keep dreaming: why we merged with Beat the Q
Entrepreneurs are dreamers. We create ideas for products that never existed and then embark on the hard slog of turning them into reality. At this stage, day-to-day challenges can be immense. Most start-up books extol the importance of focus, and in 2014 I learnt how important it is to keep dreaming.
The first three months of this year were busy. I raised a round of capital, recruited new team members and focused on growth and engagement metrics. Our strategy was clear, but I had tunnel vision in working toward it.
Posse had evolved into a network of shop owners and shoppers. We helped them to connect and build relationships with each other through recommendations, private messages and rewards, had built scalable processes and were onboarding 1000 new shops every week. With 50,000 shops on our network and an expanding presence in Asia, I was confident we were on the right track.
In March, I started to get distracted. A number of other startups approached me, all of whom wanted to partner with us. I shut them all down. This was no time to dream about possibilities; we had to focus.
Most had loyalty, payment or analytic products aimed at independent merchants. All of them had the same challenge – scale. They were out signing up shops one by one in the hope that one day they’d get enough shops so that consumers would use their app across a network. None had much capital and all were competing with each other.
Most of the meetings were introductions from existing investors in Posse so I had to take them. At first, I was frustrated that all these interruptions were distracting me from work I needed to get done.
I do my best thinking while out running in the morning. It’s the one time of day when there’s nothing else to do except think – and run. What if we allowed all those apps to access our users? Could Posse become the iTunes of a shopper / shop owner network? No, focus was important, we should stay on track. But I couldn’t help myself and kept dreaming about what the future could hold.
One afternoon I picked up our team lunch from a Mexican takeaway shop in Surry Hills. I noticed they had three tablets and an android phone behind the counter, each with different stickers on them. I asked the woman serving: ‘What are all those things?’ I remember the look of despair on her face as she threw her hands in the air and admitted she didn’t know how to work any of them. On further investigation it turned out there were two order-ahead tablets, a loyalty app and a tablet collecting analytics.
For me, ideas hit like explosions. There’s always a background of thinking, usually over several weeks, but the vision hits in seconds. It feels like a door opens to a universe that didn’t exist before. There’s a rush of adrenaline and I can think of nothing else.
I was sitting in a coffee shop, mid conversation with one of the small app companies and I allowed my mind to drift. What would the future look like? Would consumers use all these different apps? What about the lady at the Mexican restaurant? What would she want? All of these products were awesome, they were changing the face of retail – but surely no one wants one app to pay at a café, another to get loyalty, another to pay for take-away food, another four to pay for tabs at different bars.
For the mass market to order, pay, gain loyalty and interact with shops there has to be one app that works everywhere. Someone would develop a winning product that would one day dominate the market. Given that we’d already built the network – we have an engaged and scalable base of shop owners and shoppers – we were in a good position to give it a shot.
I’d always wanted to build a really big company with a product that everyone would use and would make life just a little bit more awesome. I’d just never had quite the right idea at the right time in the right market; this immediately felt like I’d cracked it. I called up the two or three smartest people I could think of that day and shared my vision. They got it and wanted to be involved. I knew this was it.
That night, I started sketching out a plan. We needed to launch a product quickly, get well capitalized, focus, and avoid as many mistakes as possible. First, I considered raising again, then building the ordering, payments and loyalty aspects ourselves but that would take too long and it was clear other teams had spent years working out how to build the best of these products. Next I thought we could roll-up five or six other businesses and IPO as a group. That sounded exciting, but the exercise of bringing these groups together and listing would be a distraction that would slow us to a crawl.
I researched the market, asking everyone I knew who was doing the best job of payments and loyalty. One name came up in every conversation – Adam Theobald at Beat the Q. Adam owned both Beat the Q and e-Coffee Card so he had the number 1 ordering, payment and loyalty products under his roof. He also had a reputation as a great founder. I asked a friend for an introduction and we met for a coffee.
The rest was surprisingly easy. I shared my vision for creating an ultimate product and consolidating the market. It turned out he’d been thinking exactly the same thing, which is what led to his purchase of e-Coffee Card earlier in the year. We started by spending an afternoon workshopping user stories and dreaming about what the product would look like. I drew on my experience at Posse, which focused on relationships between shop owners and shoppers and Adam described exactly how ordering, transactions and loyalty should work. In that one session we learnt about each other’s businesses, designed the user flow for a new app and planned the business strategy.
It was a productive afternoon.
Even more exciting than the plan was the seamless way that Adam and I worked together. We had the same vision but came from different perspectives. The synergies between our businesses and ourselves as individuals were enormous. We also got along well – I could immediately see that this was someone I’d enjoy spending a lot of time with. By coming together, we could achieve so much more than the sum of our parts, and we’d have fun in the process.
If you read about our merger in the media last week then you might assume it came together quickly. So much has changed – it feels abrupt to me too. Yet, it’s been six months since our first workshop session and it’s been an intense ride since then. We’ve moved into one office, and we’re working as one team on a new product.
Apologies for being slack with my blog posts this year. I’m sure you can understand, I’ve been pretty busy and I’ve been writing a weekly column for The New York Times as well. I appreciate everyone who continues to read my posts and especially those who write comments.
The good news is that the new merger has brought a raft of challenges and opportunities for me to write about. There have been speed bumps that I can share now that the news is out. Bringing together three products, two teams, two founders along with an ambitious plan was never going to be simple.
This time though, I feel incredibly lucky. I can’t imagine a better fit for our business, team and for me as a co-founder. Successful startups are often about luck. My lesson from 2014 is to keep dreaming and look for opportunities to get lucky.