9 things no one told me about running a business

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Lessons learnt from running Tinker London.

Transcript of 9 things no one told me about running a business

  • 9 things no one told meabout running a businessAlexandra Deschamps-Sonsinodesignswarm.comriglondon.com

  • 1. Everyone wants to know why you failed.

  • 2. Dont try to start 3 businesses at once.

  • 3. No one will lend you money.

  • 4. Dont hire anyone.

  • 5. Its fame or fortune, rarely both.

  • 6. Noone is irreplacable.

  • 7. Youll never work for free again.

  • 8. You will remain unemployable.

  • 9. This will change you forever.

  • Good luck!Alexandra Deschamps-Sonsinodesignswarm.comriglondon.com

    Hi my name is Alex and Im a designer. This is a talk I havent been wanting to give, Ive been avoiding giving even. When Ved asked me to come and speak last month, I thought long and hard but also thought it might be cathartic which it has been, especially as today I sent out the last boxes of my former companys accounts to our insolvency company in North London.

    But the fact of the matter is running my business Tinker London for almost 4 years, I learnt a lot. Things that I could never have imagined, 10 of which I wished Id known before starting. I thought Id share them with you and it might be useful for anyone else wanting to start a business in the creative industries / tech.

    *Ill start with the latest finding which is that when you close a company, everyone always wants to know why. And when you tell them finance they still want to know why. As if there was some sort of thing you were holding back. Im not. Finance. Money. When you cant make the money side of a business work, thats not a business, its an expensive hobby. There are a million reasons why the money thing didnt work out, bad debts, losing contracts, unpredictable cash flow, unclear business plan that would lead back to unpredictable cash flow and the list goes on. But yeh, money. In our industry, some people avoid closing by selling their business to someone like an advertising group, an investment or consultancy firm. We just decided to close and move on. *I studied product and interaction design and was mainly motivated to get people to look at the world of product design with different eyes, more technology saavy eyes. At the time, my business partner had founded Arduino, an open source tool for controlling low level electronics, quite useful if youre a designer with no coding background.

    So in order to diffrentiate ourselves and introduce ourselves to the London-scene (I had just moved there) I became the UK distributor of the platform, organising workshops for creatives and meeting people who would eventually become our clients. This tech-centric multi-headed approach did not pay on the long run. It became a game of badly managed margins. We tried to do the job of electronics distributors, schools and r&d departments all at once. Id advise just settling for one. *We incorporated in late August 2007 after months of initial work and our creditors meeting was January 7th 2011. At no point in time during those 1,227 days of trade did anyone give us a credit card, a loan or debt factoring. We ran the whole thing on cash. It was insane. We started the business on 8K EUR that Massimo, my business partner invested in so we could buy enough materials to distribute Arduino and get me out of my boyfriends flat. Noone was ready to lend and our credit ratings meant we couldnt apply for a credit card for the buisness. That definitely trumped our ability to grow or take on more risks than we were taking already. *Dont hire anyone, really. If you must hire someone, make it your financial advisor. I say this very carefully. Employees are expensive and when you are basically following an agency or consultancy model, you have to make sure you have work on ALL the time in order to justify the expense. Otherwise, you end up being the last person paid. *We were featured prominently in the Guardian, The Evening Standard, the BBC. Make magazine, an industry tech and geek blog featured most of our work, by any measure available for such a young business, we were successful. Something I learnt along the way is that this does not translate into sales. You still have to take care of business development. You also often end up working for no money on projects you think will have enough of a public impact and do work for money you will never mention on your portfolio. Its a strange Catch 22 that isnt particularily popular but when the well known photographer Annie Leibovitz was bailed out by a bank because shed gone bankrupt, I could understand. It happens. *Dont be too precious about your time and your tasks. Or other peoples. Clinging on to staff or tasks will make you a slave to them and you can re-hire or meet other people who will bring something new to the table. *This is more of a learning post-company I suppose, but after doing so much free stuff for so many years. Free conversations, free advice, free lunch talks, free evening talks, etc I am now much more precious about my time. *I dont say this in a deprecating way. Unemployability means that you are unwilling to see the value of someone elses org chart. It also means that you will want to keep starting companies. Its sort of my drug in a way, theres always the hope the next one will be better. Always the desire to try. *All in all, I can say running a business has changed me forever. For good. I cant even imagine what life would have been like had I not seized that opportunity at the age of 26, fresh off a flight from Amsterdam. That folly will carry me in the next decade I know it. *The best time to plant a tree was 20 years ago. The second best time is now.Now go and build your own business. Youll never look back.