Venuefox Co-Founders Speak of Market Validation, MVP's, Accelerators and Partnership Agreements
"Our motto is 'Keep Showing Up'" Andrea Hansen, CEO and Co-Founder of Venuefox, declared in answer to an audience question regarding how she perseveres down the arduous startup path. "We know we are going to suck at whatever we do until we get good at it, so we keep trying," added Co-Founder, Jerod Mollenhauer, admitting that this keen insight might be slightly plagiarized.
Hansen and Mollenhauer were guests of Mike Colwell, Executive Director of the Business Innovation Zone at the February edition of Startup Stories, where they shared insights and lessons learned, now in the third year of their entrepreneurial adventure, before an interested audience which included the inaugural class of Greater Des Moines' (DSM's) Global Insurance Accelerator.
Planning for Dissolution of Partnerships
Appearing as co-founders in this monthly gathering, which typically sees single founders, Mollenhauer and Hansen could bear witness to the importance of recognizing the inevitable result of partnerships and planning for it. "We had heard enough founder stories that we went in with our eyes wide open," Hansen explained of the simple truth that all partnerships are going to ultimately dissolve and that it is best to have a clearly defined equity relationship and plan for dissolution going in.
"We signed the pre-nup," Mollenhauer joked, explaining they had established both a vesting schedule and specific milestones for each to meet as they moved forward. Both, however, concurred that this partnership, facilitated by Hansen's hair dresser who is also Mollenhauer's brother, is going very well so far.
Venuefox, was initially the brainchild of Hansen, birthed by her 15-plus-year career in development which meant she was often planning events. It's an online marketplace to discover and connect with venues and vendors for corporate events. Intended for small and medium-sized businesses, it allows executive assistants and other part-time event planners to review available venues while serving as a third party marketer for those partnering venues.
Of course, like many startups, it took a while to discover the actual niche they wanted to serve and as Mollenhauer told the group, that was their first and perhaps largest mistake. They started out serving virtually every conceivable event from children's parties to weddings to corporate meetings because they didn't invest enough time into market research before committing to a platform they would ultimately abandon. "We were too broad in our focus and we built something that the market eventually told us they didn't need," Mollenhauer observed. Hansen added that they could have tested the market in a much easier way, with much less and found the answers that would help them narrow the focus to where they are today.
The Accelerator Experience
After scrapping the website on which they had literally spent thousands of dollars, opportunity came knocking. Accepted into the inaugural class of the Iowa Startup Accelerator in Cedar Rapids, they temporarily relocated to Eastern Iowa and went all in, submitting themselves to the whirlwind experience that some of their audience members were just beginning; life at an accelerator.
Characterizing the experience as tantamount to acquiring an MBA, the co-founders listed knowledge, particularly focused upon their specific business, along with connections and advisors among the greatest values they found within the accelerator experience. "Having all these mentors lined up, knowing they were committed to the accelerator and that you could call on them saved a ton of time trying to network," Hansen recalled. In addition, the presence of the other teams made the experience more collaborative and allowed even further leveraging of expertise within and among the participants.
Advice for Startups
In response to an audience member's request for advice, the duo encouraged them to ask for help. While the mentors and advisers are there for that very purpose, the startups need to be proactive and express the help they are looking for. At the same time Mollenhauer cautioned, "You don't have to act on all the advice you get because you're going to get a lot, and some of it needs to be filtered out."
Providing a periodic status update email to mentors and advisors as well as investors and potential investors was cited as a good means to both keep open communications and remain top of mind.
Hatchlings creator, Brad Dwyer, asked the pair to compare and contrast the startup scenes. As they had already alluded to, the physical space of the accelerator in Cedar Rapids was impressive and there isn't an equivalent in Des Moines. "I loved the Cedar Rapids startup community," Hansen said who has previously expressed her respect for the Corridor entrepreneurial ecosystem and her hope that Iowa's various hot spots of activity can grow more close and collaborative in the future.
Acknowledging that the smaller size of Cedar Rapids, plus the relative proximity of Iowa City created a unique scenario, both expressed a hope that the Des Moines community could find a way to welcome new blood, perhaps expanding the focus to include a broader segment of the entrepreneurial community while also identifying a larger pool of early stage investors.
Meanwhile, happy to be back in Des Moines, Hansen and Mollenhauer are focusing on their Minimal Viable Product as they construct a unique referral platform that fits a market demand they have well identified. Toward that end they plan to keep showing up.
Square One DSM, an initiative of the Greater Des Moines Partnership, is formerly known as the Business Innovation Zone (BIZ).