Why do some business ideas get funded while others get ignored? Why do some businesses take off and disrupt entire industries while others do not?
Questions such as these drew a crowd of more than 60 escapees last night to Esc HQ in Bank, London.
Ex-management consultant and angel investor (and self-confessed math geek) Avin regaled us with the fascinating story of his journey setting up Housekeep, a booking platform for professional home cleaners, disrupting the £4billion home cleaning market.
He also shared valuable business lessons he’s learned first hand along the way.
After helping get so many exciting businesses off the ground and getting a taste for the thrill of setting up a brand new venture, Avin decided to go it alone and start his own company.
Choosing the right business to start
Despite spending 6 years at Smedvig investing in many high-profile start-ups, Avin admitted to our group that his own personal entrepreneurial experience was pretty much limited to reading Richard Branson’s autobiography.
He had no idea what type of business he wanted to start but he did know he was itching to get going.
Avin found his ideal business by moving away from typical advice handed out to aspiring entrepreneurs; that you have to find your passion and love your chosen industry.
Instead Avin focused on choosing a business that made sense in a market where he smelled success.
Avin took a methodical approach to selecting the right business idea. Instead of thinking about his personal areas of interest, Avin focused on analytics to lead him to the right decision. Avin believes the best businesses are service driven. With this in mind he evaluated ideas against 3 key criteria:
- Which markets are big but have a fragmented supply?
- What do consumers purchase repeatedly and regularly?
- Which markets has technology yet to revolutionise?
Professional cleaning services is the first idea Avin came to following this analysis and he knew right away he was on to something.
Testing the water
To gauge if there was a genuine market for his idea Avin sent out a simple survey testing initial assumptions to 700 people via Facebook. This survey revealed the drivers behind his customer’s decision making process when hiring a cleaner; quality, price, service, trust, and reliability.
Avin told the group that whatever you are selling or doing it’s critical to try it yourself – only then can you know your market.
With this in mind Avin started clean homes himself to see firsthand what it’s actually like to be a cleaner and what the challenges were. Doing this also enabled him to understand his customer base really well. Armed with this deep level of insight, Avin was able to attract, train and retain great staff and loyal customers.
After completing this exhaustive research, convinced his idea was viable, Avin approached some investor friends to secure all important funding to get the business off the ground.
Just three months after launch Avin raised £1m investment.
Avin peppered his talk with so many useful tips:
- Only raise capital if you really need it and have a clear idea for how you’ll spend it.
- When looking for investment you can either go for easy money or useful money. Always choose the latter. (i.e. those on the board of successful startups)
- The key team member you need to recruit when launching your own business is a tech expert / web designer / architect as this will be the guts of your business. But remember, your website is merely your ‘shop window’ and you’re nowhere if you don’t understand your operations.
- You don’t need to fear your competition. Deliver a bit better than everyone else and charge a bit more than everyone else.
POST WRITTEN BY CELIA STATON
Follow Celia’s blog “Dared, Determined, Done!” about making big life and career changes.