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Sorted Circus Tested Their Hypothesis First to Guarantee Success

Testing their hypothesis made the difference between failure and rapid success for the Sorted Circus entrepreneurs Doug Foulkes, Tracey Foulkes and Claire Burge, because simple is always better.

Monique Verduyn

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Sorted-Circus

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Vital Stats:

  • Company: Sorted Circus
  • Players: Doug Foulkes, Tracey Foulkes and Claire Burge
  • Est: 2013
  • Visit: www.sortedcircus.com 

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When the founders of training company Get Organised started developing a productivity wellness app called Sorted Circus, they applied the lean start-up methodology. This was just as well, because when they asked their clients to test the product, the feedback was not great.

“The most remarkable part of our process is that we did not rush to market despite us wanting to and having clients raring to go,” says co-founder of Sorted Circus, Claire Burge.

Related: Xola Ndziba: Lean Start-up Approach to Limu

“We prototyped, and when we tested it on our clients, the feedback was that it was way too complex. We stripped it down completely and now offer a much better solution all round. It’s been so successful that the simpler product is also a global offering and we have partnered with a New York-based company to spread its reach even further.”

Today, Sorted Circus is a six-month productivity wellness programme that increases employee efficiency and impacts the bottom line.

Employees are presented with a series of time and task boosting challenges delivered via email. Without the need for complex passwords and logins, they are prompted to learn and then ‘check-in’ on how many times they implemented each challenge.

Everything is tracked on the company’s dashboard which displays a leaderboard showing off the top ten users as well as a comments section.

“Initially we had fancy dashboards and gamification built into the app, but then we were told that users were not ready for something so complex,” says co-founder Tracey Foulkes.

“That’s hard for an entrepreneur to hear, but it ultimately saved us a lot of money and time. We were about to spend another million on top of the couple of hundred thousand we had already committed to the project.”

Building on what works

Getting feedback from prospective clients was incredibly valuable because despite the criticisms, people loved the concept.

“As much as we had to admit there were problems with the product, we also discovered that our clients liked the idea — five of them were prepared to commit to 100 users each if we came back with a simpler version. So we went back to the drawing board and we also looked at what global wellness companies were offering.”

Taking the lean approach

‘The Lean Start-up’ idea is based on lean manufacturing – a management philosophy that can easily be applied to start-ups. A key part is creating a feedback loop: Build, measure, and learn. Critically, although you want to get through that loop as quickly as possible, it’s not just about failing fast, but about failing well. In the case of Sorted Circus, the founders listened to the feedback, took in the negatives and the positives, and went back to the drawing board.

“The message is test, test, test, test before investing huge amounts,” says Foulkes.

Related: What is The Lean Start-Up Movement?

Test your product

There’s a big difference between thinking you have a great new idea and proving it. By organising your company so that it’s built to learn, you can save yourself the endless hours that many entrepreneurs work before taking a ‘perfect’ product to market. In his book The Lean Start-up: How Today’s Entrepreneurs Use Continuous Innovation to Create Radically Successful Businesses, Eric Ries, who failed several times before realising there had to be a better way, says that believing in your own plan is probably the worst thing a start-up can do.

Even with a great business plan in hand, you have to ensure that reality conforms to your plan and that you don’t just assume you are right.

He notes that learning that your product is all wrong can lead to a ‘pivot’ in your business plan — as it did for Sorted Circus.

Failure led to a change in strategy, and here’s what is important: All a pivot is, is a change in strategy without a change in vision. And whenever entrepreneurs see a new way to achieve their vision — a way to be more successful — they have to be nimble enough to take it.

Related: Turning a Perfect Formula on its Head: The Lean Start-Up

Monique Verduyn is a freelance writer. She has more than 12 years’ experience in writing for the corporate, SME, IT and entertainment sectors, and has interviewed many of South Africa’s most prominent business leaders and thinkers. Find her on Google+.

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Start-up Advice

(Podcast) Playing To An Audience Of One

When you’re starting out, you’re often playing to an audience of one.

Nicholas Haralambous

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When you’re starting out, you’re often playing to an audience of one. No one knows who you are. No one understands what you can give them. You need to really, really believe enough in what you’re doing to play to an audience of one until you can build up traction. Don’t give up too soon.

Listening time: 3.25 minutes

Related: (Podcast) What You Buy May Not Be What You Need

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Start-up Advice

Your Questions Answered With Alan Knott-Craig

Which comes first, customers or revenue? To make revenue, you need customers. Here’s how you build a business that people will care about.

Alan Knott-Craig

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How can I start a small Internet service provider ISP business? — Tonderai

This is similar to the hoary chestnut, “How can I take over the world?” The answer is the same. Sit at the knee of a master for two years (at least) and learn the game. When you have a sufficient network of contacts, and understanding of the business, head off on your own. How do you find a ‘master’? Identify an ISP that appeals to you. Get your foot in the door somehow, even if it’s just making coffee. Work your way to as close to the CEO’s door as possible by continuously over-delivering. Learn like a sponge.

The possible alternative to ‘find knee of master’ is to find a technical guy with zero sales inclination. Make him your partner. You become the front office (sales — find customers). He becomes your back office (tech — product delivery). If you can’t find a master or a tech partner, you can’t start an ISP.

Related: Want To Leave Customers Grinning And Vowing To Return? Do The Following

How do I find a co-founder? How do I find a development team? — Kirsten

For a technical co-founder, Tinder is best. Jokes. In fact, Tinder is the last place on earth to find a technical co-founder. Rather try family and friends. Conferences. University. Milk your networks by letting everyone know that you’re looking for a technical co-founder. Failing that, you must hire a development team.

The days of compensating software developers with equity in lieu of cash are long gone. Absent a technical co-founder, there is only one way to develop software: Pay for it. How do you find the right dev-house?

Word of mouth is best. The rules of thumb are:

  • Maximum project duration = three months.
  • Scope it once. Don’t change the scope.
  • Keep it simple.

For your first iteration, it usually makes sense to go with a young and relatively inexperienced crew (try www.avochoc.com). Yes, the product will not be future-proof, but your first version need not be future-proof. You just need something to start signing up customers and getting market feedback.

If you get traction, then you can start worrying about scalability and consider engaging with more experienced (and expensive) dev-houses.

I have invented a hamburger roll that ensures the patty and toppings cannot escape. Would you suggest I patent it?  — Albert

Interesting idea. From the photos, it seems your solution is a variation of a pita bread. It may be worthwhile reading Zero to One by Peter Thiel.

He argues that consumers will always resist change, even change that is very obviously good for them, ie: non-leaking hamburger rolls. The only way to introduce innovation into an established market is if it represents a minimum of 10x improvement over the status quo. Only such a quantum improvement will induce people to change behaviour.

Although undoubtedly a big improvement, I’m not sure the non-leaking hamburger roll qualifies as 10x innovation. And so it probably will not succeed in the market place.

Before patenting, I suggest you try sell some rolls to establish whether you can get traction and prove revenue potential.

Related: Direct Marketing: Go Where Your Customers Are

I’d like to launch an app with an advertising revenue model. What do you think? — Mvelo

I’m sorry to be the bearer of bad news, but advertising is an insufficient revenue model in South Africa. You need to figure out another way to make money. Most times, the paths to non-advertising revenue streams only reveal themselves once you have users.

You should work on the assumption that it will take you at least two years to get sufficient traction, therefore you need to have two years’ worth of runway before plunging into your entrepreneurial adventure. In those two years, you should be growing your users as much as possible.

The size of your user base will determine your negotiating power with potential investors and/or customers, and will determine the odds of success in finding a non-advertising revenue stream.

Okay, forget advertising. I’m going to charge my users a monthly subscription of R20. — Mvelo

I realise that it’s a chicken and egg situation, but it’s very hard to find backing until you have proof of your theory working in the real world. On other hand, it’s hard to get proof without first finding backing. That’s the entrepreneurial quandary.

Generally speaking, the egg comes before the chicken. The egg is users. The chicken is revenue. Before you can test your revenue theories, you need users. Refer to previous answer.


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How The Black Umbrellas Programme Can Boost Your Local Black Business

Going it alone and succeeding isn’t unheard of in entrepreneurial circles – but getting the right backing can accelerate your success. South African SMEs have a ‘big brother’ in Black Umbrellas, explains CEO Seapei Mafoyane.

Shanduka Black Umbrellas

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Vital Stats

Going it alone and succeeding isn’t unheard of in entrepreneurial circles – but getting the right backing can accelerate your success. South African SMEs have a ‘big brother’ in Black Umbrellas, explains CEO Seapei Mafoyane.

The networks that the programme has are extensive. Along with mentorship, when these building blocks come together, they do something really majestic for the outlook of SMEs.

The Challenge

“The perception of SMEs in corporate South Africa is that they’re risky, unreliable and incompetent,” says Seapei. This results in a lack of opportunities for SMEs because large corporates still view them as potentially risky.

Related: 10 SA Entrepreneurs Who Built Their Businesses From Nothing

Joining Black Umbrellas offers the following:

1. Cameraderie

Belonging to a group of people who are going through the same challenges that they are. I think it’s extremely encouraging to find people who understand the challenges in the environment you’re going through.

2. Entrepreneurial spirit

You find businesses in different sectors and at different maturity levels in their business lifecycle. It’s very encouraging for someone starting out in their business to find a more mature business, perhaps in their second or third year, that has banked some projects.

3. Relying on a big brother

Black Umbrellas has been able to build a brand that is recognised for understanding the needs of corporate South Africa and being able to empathise with the requirements and support structures of SMEs. What entrepreneurs look for in the programme is that big brother that helps them weather the storm.

The Solution

“In a market where there’s quite a visceral relationship between corporate South Africa — where the majority of markets are — and smaller, medium enterprises trying to locate those opportunities, Black Umbrellas really is a meeting place,” says Seapei.

“We provide a marketplace for corporate buyers and SMEs to come together in an environment that is trusted. Some of the opportunities our businesses are able to access would not have been accessible to them if they were flying solo.”

SMEs abound, but it’s not always easy for larger corporations to find, vet and mentor them.

SMEs that join the Black Umbrellas programme have reported reaching levels they never saw themselves achieving outside of the programme.

“It sounds overly-simplistic, but I think the change is tremendous when SMEs join Black Umbrellas,” says Seapei. “It’s quite a thing to watch: A business trying to do this on their own and how their outcomes change when they join the programme.” Black Umbrellas opens them up to a network of help that is as wide as it is deep.

Related: Attention Black Entrepreneurs: Start-Up Funding From Government Grants & Funds

partnershipThe Power of Partnership

“We’d never be able to do anything we do without relying on collaboration,” emphasizes Seapei. “We rely very heavily on corporate partnerships to avail those opportunities to us and those markets for SMEs to be able to do what they do.”

Black Umbrellas has an extensive network of funders and donors that is expanding continuously and prides itself on being the custodian of SME development in South Africa. She says the programme aims to ensure high-impact SMEs produce incredible results to turn the outlook of the economy around.

One of Black Umbrellas’ longest-standing partnerships is with Transnet:

  • Transnet understands the mandate set out by Black Umbrellas and the need to invest in entrepreneurs.
  • We’re able to support their supply chain through the development of these dynamic businesses that go on to transform their supply chain and respective communities
  • Transnet has an incredible impact on the economy — through just two small incubators in Richard’s Bay and Port Elizabeth, with almost 500 jobs, which is a huge social return on investment.

BECOME A BLACK UMBRELLAS SME

Black Umbrellas’ mandate

Many start-ups don’t make it beyond the first two years because of inadequate planning, lack of support, financial or knowledge resources. Yet the growth of the SME sector in South Africa is vital for economic development of our country and in solving the unemployment crisis.

Black Umbrellas offers a platform through which to develop a business from its start-up phase to full independence. Because the programme addresses the multidimensional components required to develop an emerging business into a sustainable one, entrepreneurs are 100% supported on their business journey, which gives them the leverage to succeed. This support includes access to markets, networks and finance.

Programme benefits

Emerging businesses are supported with infrastructure, mentorship and collaboration, to assist their transition from incubation to viable, independent businesses.

For committed, hardworking and dedicated entrepreneurs, this multi-tiered business support programme is an important catalyst in enterprise development.

Related: 10 Dynamic Black Entrepreneurs

Black Umbrellas’ contribution to the economy

  • In seven years 1 000 SMEs have achieved a collective turnover of over R2 billion
  • The programme has contributed a combined R118 million in taxes back to the fiscus
  • Over 10 000 jobs have been created through our SMEs
  • R436 million in salaries has been contributed as a result of the programme.

Mistakes to avoid when establishing your SME within a large supply chain

Focus on a specific area where you can add real value. You’ll never be able to maximise every opportunity by trying to be all things to all people, says Seapei. “As an SME you want to find a particular niche that you can fill successfully, thereby maximising your unique value proposition.” 

Who should apply?

  • Entrepreneurs with a business enterprise at its start-up phase
  • The business should be registered with the Companies & Intellectual Property Commission (CIPC), and for small business tax
  • You must have the passion to succeed and be willing to work to achieve your business goals
  • You must be South African and black according to the BEE definition.

The 2017 National Enterprise Development Awards

Top performing small and medium enterprises have been recognised at the Black Umbrellas National Development Awards. Black Umbrellas established the National Enterprise Development Awards (NEDA) in recognition of the achievements of the entrepreneurs in their business incubation programme. These awards highlight the hard work and dedication required to establish and sustain a successful business that creates jobs and contributes to the economy.

The finalists were selected from regional enterprise development awards ceremonies held at each of the Black Umbrellas incubators across the country. The businesses in the incubators have altogether created and preserved over 10 000 jobs across key economic sectors, which include mining, construction, engineering, security services and project management.

Overall winners were:

  • Most Jobs Created: Hula Minerals and Processing
  • Best Performing Company: Aquila Projects (PTY) LTD
  • Best BU Ambassador: Recycle 1st
  • Overall National Winner: Modi Mining
  • Incubator of the Year: Johannesburg incubator
  • People’s Choice Award Winner: Recycle 1st

Seven Years  1 000 SMEs R2 billion collective turnover

  • Contributed a combined R118 million in taxes back to the fiscus
  • Created more than 10 000 jobs
  • Contributed R436 million in salaries
  • Expect more from your ESD Investment.

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