5 Lessons from Year One as a Studio
May 19, 2022
As our design & dev studio Innovetted has just passed the one year mark, I’ve been reflecting on lessons learned from the past 12 months together after pivoting from a "dead in the water" product to a near $100K MRR studio. Here are some key things we learned:
1) Listen to Customers
The old saying "the customer is always right" does have some caveats 😅, but listening to them goes a long way to improving your product/service. We didn't have clients asking for our product, but we did have people asking for our help with their product. We saw high demand for services based on our agile, no-code development model. So, with $0 left in the bank account we pivoted to services. Taking our product failures and using our development skills with clients enabled us to build strong relationships and quickly scale.
2) Find Your Team (And Hold On To Them)
We've probably heard, "players win games, but teams win championships," and if you're trying to go the distance in the startup world, you need a strong team. I can do a whole separate thread on how to create a team culture, but in the early stages it is critically important that you find the group that is there to both lead and execute. As a founder it's important to find the people better than you that believe in your vision and can help you get from point A to point B. Your team is how you grow, and finding the right team is hard, but when you have them, hold on to them. Good "winning" teams are hard to find.
3) Know Your Margins & How to Scale
At InnoVetted, we grew a team of 4 people with $0 to a team of 22 and our biggest month with just under $100K revenue in about 9 months. It wasn't easy and there are too many stories for just this thread, and we made a TON of mistakes, but probably the #1 mistake we made was not knowing our margins and how to scale. It's different depending on if you are a product or a service, but the same lesson applies. In the service space, it started with us taking some flat-rate scope of work agreements and also missing critical scope of work items early on when we were new, but quickly we had to adapt. Clients ask why our proposals and contracts are "so long" (granted most of them are 20 pages+) but you have to cover your bases and leave no stone unturned. Clients are looking for accountability and transparency, and while unforeseen things always happen in consulting, doing good research before presenting a Scope of Work and Proposal lays a solid foundation for reasonable expectations on both sides moving forward. The same is largely true for products. While different, what I've seen with our clients is that if you are miscalculating your expenses and what you need to scale in market, you'll either miss your pricing and miss out on profits, or you'll miss product-market fit altogether. There can be other reasons for this (this is why market validation is a good first step), but being able to constantly figure and project your margins is key to keeping your business scaling and growing.
4) Sometimes You Have to Shut Up & Work
Full transparency, we didn't get our company to $100K MRR on LinkedIn, Twitter, or anything else. It was building authentic partnerships and grinding out the work. Literally, we moved within our professional networks, took on some sizeable RFPs, and we're also fortunate to have a lot of inbound requests thru SEO and publicity from our former product. Some days, our founding team worked many extra hours both in and on the business. It’s never easy, but that's what it takes to grow a company. It's not conversations saying you're killing it, but going out there, working as a team, and actually killing it. This isn't to say that posting on social media, or bragging about your company and growth in front of investors isn't part of the job, but it also took a lot of self-discipline to realize it's not just about talking, it's really about doing and producing those results your team needs.
5) Have Fun & Grow
Being a founder is a journey that's both a shit storm and the most exciting thing you'll ever do. You'll laugh, cry, lose sleep, have amazing opportunities, get some anxiety, get excited, lose money, and make money. But inside that is some incredible growth. So, don't forget to have fun, be yourself, be kind, because it's all a journey. You can't fall over and give up, but you also don't have to be on "go" 24/7 either. Enjoy life, make time for friends and family, and make sure you love what you do. It doesn't mean it will always be easy, but if you're a founder who loves your business and loves your team, I promise it makes waking up to do your job every day easier and those wins that much more rewarding when you make it happen together. Enjoy the ride 😎
That's it for now, hope to do more of these in the future, but hope you enjoyed my learnings from InnoVetted Year 1 👊🏼
Follow @innovetted and @dericthedevguy on Twitter for more on what we're doing and what's new in the world of tech products.