Experience in starting a company
Dear Professor, I received your email regarding sharing working experience with current students. Since you have encouraged me to start my own company, I feel that I must share my experience with current students.
“When I graduated, I did not want to work for a company even I had several offers. After discussion with my parents, I made the decision to start my own company. Throughout the years in college, I have read many books on marketing, finance, business and how to start a company so I was ready. I also discussed with few professors about the idea of creating a software product called “Where to go?” and they have encouraged me to follow my passion.
The “Where to go” idea was created when I and my girlfriend decided to go out one night but we did not know where to go. There are many restaurants, coffee shops, dance clubs nearby but we were uncertain which one to go. My girlfriend said: “I wish somebody tell us which one, and give us some information on the best place to go for a night like this.” That idea stayed on my mind for a long time. Later, I found there was no existing product that I could use to make decision on where to go. I realized that there was a potential market for a mobile app to help people making that decision.”
My idea was simple: Customers type in the location where they are on their mobile phones. My software will search all restaurants, nightclubs, coffee shops etc. within one square kilometer and display to them as well as the direction how to get there. If customers decide to go to a place, they will receive a text message of discount coupon worth 10% of what they spent. After that, they also receive a text message asking them to rate that place. The rating is simple: One star for not very good and five star for excellent. The rating will be incorporated in my software as reference. For example, user can see list of restaurants with different rating, from one star to five stars, and they can choose to go wherever they prefer.
My business was also simple: To be listed on my software, business such as restaurants, nightclubs, coffee shops etc. must pay a monthly fee to my company for adverting. The fee varies depend on the size of the business. They also have to agree to reduce 10% of their price to any customer that use my service. I sell my mobile app for $2 dollar using both Apple and Android stores.
My professor often said: “Develop software is easy, selling it is a challenge.” It is so right. I spent only few weeks to build the software but many months try to sell it. After created the app, I reached out to friends using Facebook and Twitter with the following message: “Do not know where to go with your friends? Buy this app on your mobile phone.” I was optimistic that this approach would provide my company many customers but I had only a few. Next, I started advertise on Google. The ad ran for several months with only a few clicks and few customers. Despite the disappointment, I decided to continue my marketing efforts by giving the app to university students. Although the number of users increased but it did not help. Since I did not have many customers, several businesses stopped paying their monthly fee. I did my best to survive but I began to doubt whether my idea was good enough. However the passion of having a software company kept me continue for several more months. It seemed that no matter how good is the app, most people did not see the value. A friend told me: “I spend two dollars for your app and get nothing in return.” I was angry: “But you have 10% less at the coffee shop” He smiled: “For a five dollars coffee, 10% is not much.”
I believe my idea is good, I think my software works well but I did not know how difficult to market a product that help customer’s to find the best place to go and pay 10% less. I have not made much money, only few thousand dollars a month but money is never my goal. Starting a company did provide me valuable experience. It is risky but I have learned a lot from this.
Currently I am working on several new ideas and hope they will be better. One thing I know for sure is I will not give up my love of having my own company and develop mobile app software. If you do what you love then you will never regret.
Sources
- Blogs of Prof. John Vu, Carnegie Mellon University
