4. July 2013–
Nader Cserny, founder of appstretto, explains why it’s better to call time on a business idea sooner rather than later…
A lot of people are propagating the lean startup methodology, ie releasing a minimum viable product (MVP) to the masses and keeping an iterative approach with low overheads. But what most people forget to ask is: “When is the right time to kill my startup if it doesn’t get enough traction?” This post hopefully sheds light on the issue and gives possible approaches…
Prepare for failure
The fact is that most startups fail (see infographic: Why startups fail) and even more so, ideas never materialise. If you have had an idea in the past, worked on it, launched the project and maybe even got some traction you have my sincere congratulations.
Now fast forward a couple of months or possibly years… Although you have slaved yourself, neglected your family and/or invested a great amount of money, there might be a time when you have to decide: am I going to kill it or stick with it?
The problem with keeping it alive
What you shouldn’t forget is the psychological element. Day by day you are reminded there is still a project in existence that you should do more with, but you’re simply not motivated. If that’s the case, there’s not going to be much progress and the project is neither dead nor alive.
The problem with this state is that you are not helping anybody and mostly you are not helping yourself. You still have it at the back of your head and it is keeping you from pursuing new (ad)ventures. Don’t half-ass two things, whole-ass one thing. You must get room to breathe. Make a decision!
The problem with killing it
Who knows if you have focused on the right areas in marketing, product vision, SEO, PR, design or content production? Maybe you just need to tweak a couple of things and time is not ripe to shut down the servers.
How much time have you spent until this moment? Maybe you have missed the bigger picture, are stuck in demotivating little details and an outside look from somebody not as deeply involved could help you get back on track.
There are times when motivation is at rock-bottom and it decreases every time you read about startups that magically became popular within a week after launch. What you should never forget is that there has been a lot going on before it actually went public. You are just seeing a small fraction of it. Perseverance and constant iteration is key!
How others did it
KILL EARLY: Basecamp Breeze
Basecamp Breeze was launched by renowned 37signals earlier this year and a mere four months later they killed the product as they “didn’t see enough customer traction”. This is on a scale that most of us would probably be happy about, but for all the needed team effort (maintenance, motivation, product vision, execution, support …) it just wasn’t good enough.
I think this is a good example of kill early and often, and – more importantly – they are handling the situation in a great way: an open statement without any bullshit, a full refund to current customers and a hint to alternative solutions on the market.
Paul Hemetsberger, a Viennese guy I know from a previous company I worked for, has been bootstrapping his dictionary project in his spare time all the way ever since, and, after a couple of years he decided to make the jump to go full time. Today, his language dictionary is generating over seven million page impressions per day and providing him and the few employees financial freedom. He recently celebrated its 10th birthday.
KEEPING IT ALIVE… DEAD: musweet
After great success with the politics analysis platform wahl.de we launched a very similar concept for music artists. We thought it could thrive and initially everything seemed great. We got invited to present at Google’s developer day, got a couple of other showcase invitations but after an initial boost in traffic the site’s traction diminished and slowly died.
In order to stay true to our standards we would have needed a lot of editorial resources for keeping music profile data fresh and we would have had to host the whole crawling and webserver infrastructure. After three years we finally made the decision and killed it… and never regretted it.
When is the right time to kill my startup?
Honestly, it’s very hard to choose the right moment. Depending on the field your startup is in it may take one month to three years until you know whether it is time to kill or stick with it, or perhaps your project is already dead at the start because the area you chose is just too complex and competitive (think Maps).
I know companies and startups whose founders worked on them for years, poured their sweat in day by day, and have pivoted numerous times (remember the early Flash video version of Seesmic?) before it gained enough traction and finally became profitable. And this is a perfectly fine strategy.
On the other side, I know people who have been pursuing a product idea only for a year then took it to the graveyard again. My take is that it is time to kill it when you are not satisfied with the results over a defined period of time (giving yourself a deadline helps), you have tried a lot of strategies to get it off the ground, and, you don’t see any way to profit or exit. With an investor on board you will probably get a more obvious signal.
Bluntly put, it’s time to kill a project when you are not putting any more love into it.
What stage are you currently at? How do you handle setbacks and emotions? How often have you thought about killing it? Let us know your experiences in the comments below…