Startup Diary: Looking Back on Life in an Accelerator
[Editor’s Note: Justin Lee is a co-founder of TheSquareFoot, a two-year-old Web-based commercial leasing platform based in Houston. He and his three co-founders were part of the most recent class of the Entrepreneurs Roundtable Accelerator in New York, which started in January and ended with the accelerator’s fourth Demo Day earlier this month.]
I had a pretty good idea of what we were getting into before ERA began, but it’s only in retrospect that I can truly appreciate how valuable and awesome the entire experience was from start to finish. The class was comprised of 10 startup technology companies, a mix between e-commerce consumer-facing platforms, B-to-B software companies, and SAAS firms. When we first arrived at our new office space in “Espace” and had a group meeting with the operating partners of ERA, we were told that the program would break down into three parts. The first month was to be dedicated to the development and/or modification of the product, the second month would shift focus to each company’s business model and honing in on monetization and scalability, and the final month would be a focus on fundraising and preparing for our Demo Day pitch.
Luckily for us, we developed and launched a product six months prior to entering ERA, so we had a bit of a leg up with all of the data that we had collected and iterated upon. While some of the other companies in our class were working towards the release of the first iteration of their product, TheSquareFoot and a few others already had a working product in the marketplace. We knew we had plenty to modify, scratch, and add, and we were able to receive invaluable feedback from some of the accelerator’s mentors regarding our user interface and design. Feedback from customers and friends is always useful, but they can’t offer the kind of insight we received from digital marketing and e-commerce experts. We still have so much to change and reshape, but it feels good knowing that our roadmap is in place and we are constantly tweaking and testing.
One of the most sensitive subjects that we have encountered as a startup—how we would monetize and scale our company—was something we had debated internally more than anything else over the past 18 months. We had paying customers (in our case, landlords paying us a monthly subscription to market their spaces on our platform to prospective tenants searching for the right commercial real estate lease,) but we knew of several other paths to monetization and we were having a hell of a time figuring out when and how we would implement each one. After spending three fairly rigorous status/strategy sessions with the operating partners at ERA and, most importantly, gathering an understanding of what each side of the marketplace we had created demanded from us, we began to see a much clearer picture of the path we needed to take. Everything else seemed a little easier once we got to this point. Before, it seemed like every single micro decision we made as a company always went back to the macro problem of monetization. Basically, making all of the small, detailed decisions that every company has to constantly make was always a nightmare because they all tied into how we monetized. We learned the hard way that, if that plan isn’t in place, it’s nearly impossible to press forward full-steam in every other aspect of the business.
One of the first things you read about when you enter the tech-startup world is “Demo Day.” I remember watching a few streaming Demo Day pitches online from various accelerators and events and understood the point was to showcase your company to investors, the media, and other prominent members of the startup community. But I had not fully grasped which entity was powering each event and how the pitching companies were chosen to participate. Once we started TheSquareFoot, I would always wonder if we would ever pitch our company in front of hundreds or even thousands of people, and I wondered how well-received our concept would be by the tech community. When we first began preparing for our accelerator’s Demo Day, the practice pitches and dry runs didn’t go so well. We lacked confidence, excitement, and, because we hadn’t honed in our business model yet, of course our pitch didn’t come out right. Once we pivoted and really focused on our new monetization strategy and understood what each side of the market place we had created demanded from our service, the pitch really started to come together. In practice sessions, our message became much clearer and, because we had confidence in our business model and our execution, the pitch simply started improving week after week.
When Demo Day finally arrived, my expectations of the event, the accelerator program, and most importantly our pitch, were all exceeded. I want to be clear that our expectations were very high. I can honestly say that sitting in the audience watching Jonathan pitch TheSquareFoot, we looked just like all of the companies I had watched pitch at various premier incubator Demo Days and other pitch events over the past two years. I never had any doubt that we would get a lot out of being part of an accelerator like ERA and that our actual pitch would be well received, but I honestly didn’t anticipate being as proud of our team and excited about what we had been working on for two years as I was on Demo Day. We’ve had a working product, paying customers, and revenue in the door since last September, but going through ERA’s four-month program and Demo Day truly made it feel like we belonged with all of these other great start-ups trying to change industries.
I think for us, the most basic lessons we learned were around how to successfully approach fundraising and how beneficial it is to be surrounded by other like-minded individuals who are all going through the same process with their own companies, and exchanging ideas and feedback with one another. Others who have experience in the tech startup world can really see the big picture of the problems we are trying to solve.
The best advice I can give to an upcoming accelerator company would be not to wait for the pitch day at the end of the program before you start aggressively pursuing investment. Start laying the foundation for those conversations at the start of the program. Also, divide and conquer. Because there is a lot going on in the form of mentor meetings, speakers, and networking events on top of the day-to-day business operations while in the accelerator, we found it useful to divide up the responsibilities and meetings among our team to get the most out of our time. We didn’t all attend every meeting and speaker event. Instead, we looked at each week’s schedule and divided up the events based on our individual business tasks and responsibilities.