In a world where everyone seems to be killing it, every single day, it's refreshing to hear the reality: starting a business is hard, and many fail, regardless of the talented team.
Thanks for your honesty, Nathan. I'm wishing your team a prosperous future, wherever they land.
Thanks Emelyn, appreciate it.
I'm going to be the devil's advocate here, but how can a business run for three years burning cash?
I run a small consultancy business. It's not glamorous nor original; and I'm not sitting on a potential gold mine. But I've been cash positive year after year from year one. And that allows me to then explore ideas.
Is this really the american dream? Build something magical, make people dream then crash and burn?
Flip it to something that makes cash and retain your IP. But if you haven't found a way to be cash positive in three years it may be time to wrap up. Either way, all the best and I hope you achieve your dreams someday.
We ran for three years because we had huge clients in our first year and a half. We weren't really interested in building something small so when we realized our model was flawed and we couldn't rally from where we were at financially, we wrapped it up. Here's some more context: https://medium.com/@chrshys/hindsight-is-an-asshole-71ab9e118764.
As we saw it, this left us with three options:
Scale our company up and down as the work we want comes and goes. Doable, but brutal on culture and it’s hard to attract good talent if you have a reputation for laying people off.
Take on other types of work, stuff that isn’t necessarily what we got into this for, in order to keep the lights on between the good stuff. But sustaining a talented team is impossible without the right caliber of work.
Or realize what you want to do and what you need to do as a business are two different things, and leave before we’ve poisoned the well.
Fair enough. Thanks for the response. All the best.
I'm curious to know what you think about the long-term viability of the product design agency model in general. I'm guessing it takes a lot of fighting internally for big companies to get any budget allocated for innovative projects...even though it could literally transform their business exponentially. And for start-ups looking to do innovative things, they usually don't have the funding to hire agencies with likely more overhead than they have.
Advertising agencies on the other hand have been told their model is dead for the last decade, yet they seem to be doing just fine.
What they do isn't very very 'disruptive' or exciting (sometimes downright depressing like doing social posts or banner ads), but it's a steady stream. Every Fortune 500 company has a marketing department with a yearly budget allocated to spending on advertising/promotional activity. So there's always a constant need for more, and retainer agreements are easier to come by to provide a more stable revenue stream.
Kudos for sticking to your principles and not "poisoning the well." Sad that it had to end but at least you didn't waste you and your employees' time doing work you didn't want be doing.
This whole situation reminds of a trend that I started thinking about after reading this article: http://www.wired.com/2014/12/disappearing-business-of-design/
As design increasingly gets a seat at the table, companies are starting to hire in-house UX teams. IBM is purportedly hiring 1000 designers..
Unfortunately this trend means there will be less and less demand for agencies - especially the larger ones with lots of talented UX people like Heist.
Would love to find all of our team awesome places to land. DM me @n8garvie or msg people listed on the site directly!
Running an agency is very hard. Even if you're doing fantastic work, there are many unpredictable factors that are out of your control. (economy, a big client suddenly gets their budget cut, work goes internal to save money, health insurance doubles, etc).
I've been in this place as well, and it's a tough decision to shut down.
Kudos for a great-sign off. I wish you guys luck in your next venture.
Thanks Aaron. We're really proud of the work we did (some of it still hasn't launched!). It was a really tough call but appreciate the support.
Sorry to hear that. I visited Heist's office last year during the Toronto Startup Openhouse. I was really impressed! Also I really enjoyed your work, especially the research on future design for bank.
Appreciate the kind words. It was a very fun ride
Sorry to hear that. Sounds like you've done what's best for the team and I applaud that.
If anyone on your team is interested in working in data/analytics in SF, shoot me a message at blake (at) modeanalytics.com.
What we're all about: http://about.modeanalytics.com Product Designer Req: https://jobs.lever.co/mode/df6e1ecf-d4a0-457b-8e36-26ea74e4db03
Thanks for sharing your story Nathan, I appreciated every bit of it.
That sucks to hear Nathan.
That being said I'm in dyer need of designers to join me at BitGold Inc.
Anyone interested? email me: firstname.lastname@example.org
Thanks Mike, passed it around to the team on our slack.
Shitty news. I admire the vision and courage. Best of luck to you and your team, Nathan.
Sad to hear Nathan. Wishing you and the team all the best.
Your 'designing the smart bank' report was kick ass.