Category Archives: e-commerce

Startups are hard – cash doesn’t solve the problems!


I meet with lots of founders of startups pretty much everyday. The ones that are successful realise that starting a company isn’t about glamour or fun its a seriously difficult thing to so.

I have been involved (either as a founder or investor) in a bunch of startups, there are always highs and a lot of lows. The one thing that is universal is the struggle and difficulty from taking an idea from a discussion in a coffee shop or pub to a self sustaining business that doesn’t require your constant supervision.

A huge amount of entrepreneurs think that funding is the solution to becoming a successful business, but most successful businesses don’t need a vast amount of funding if they have a successful strategy.

Spending time on the strategy and discussing the obstacles around this strategy is much better than working on a funding document and deferring the strategic discussion until there is money in the bank.

Technology has become massively easier over the last decade and building a product or service for the web has virtually no cost apart from time. Trends talk about “product/market fit” as having a product that customers are willing to use and pay money for.

So as a founder – don’t think that raising money is the best use of your time, bootstrapping your business until you have good product market fit is a much better use of your time resource. It has the advantage of keeping the equity pie complete. If you really have no choice than to raise money leave this as late as possible. Focus on the product!

2015 – A year in review


2015 end of year review

It seems that the year has flown, so it’s worth looking back to see what was achieved in 2015.

Diet Chef

When we started Diet Chef we never thought it would get to the scale it has. It has massively out performed our expectations both from a customer perspective and financially. We were faced with a very tough decision in 2015 either to sell Diet Chef as we had a (great) private equity investor that required an exit or buy the company ourselves.

There were many hours of discussion on this, but standing back from things, most diet companies have been around for over 15 years and none of the macro economic factors would suggest that there is any likelihood of a company like Diet Chef disappearing overnight. So funded by a large chunk of debt we have bought out our existing investors and plan to keep Diet Chef for the longterm.

That doesn’t mean there hasn’t been changes, most of the infrastructure investments we have made (people, systems and geographic) have been reversed over the last 6 months. We are back to a controllable cost base and our plan for 2016 is about growth. This is coming from two areas – acquiring more customers and making the ones we have happier!

There was a drive for profitability over the last 12 months which was the right thing to do if we were seeking an exit with third party, but we lost a lot of our customer focus in this drive. This has been reversed and the customer has become king again within the organisation and our drive is all about making the customer experience better and allow our customers to self serve as much as possible.

In addition we have launched another brand (Diet Now) that allows customers who cannot afford Diet Chef to be able to buy a product from us. As we have grown our costs of marketing have grown, so getting more bang from the buck on our marketing spend is pretty important. Our market entry strategy for this is very much like Diet Chef in the early days. Test, learn, listen to customers, iterate!

So I am very excited to be hitting the 2016 diet season ahead of expectations and with most of the important infrastructure issues fixed.

Investments – Private

It’s been a bit of a rollercoaster of a year on this front. As you have followed I love investing in really early stage tech or consumer businesses. I was looking at a very health return on Fanduel based on they’re recently reported $1b valuation, but the power of TV (more on that later) has put them into the regulators crosshairs. I am sure this is nothing more than a blip, but pushes any return off for a bit (not that I am really worried about this, it’s a great business led by an outstanding team)

TVsquared continues to go from strength to strength. An amazing team with tons of experience are making it look easy to grow quarter on quarter (significantly!) with more depth into existing customers. I think this could be another significant investment but really the time to ramp up the sales organisation to cope with the demand. (see here)

Flavourly continues to grow and has significant cash resources following its successful crowdfunding last year. Like all businesses it is dealing with the growth factors in terms of physical space, staff and product. Looking very promising in 2016!

I am currently looking for one investment for 2017, same characteristics, ideally consumer focused with an international market opportunity.

Investments – Public

Have disposed of some of the investments in my portfolio in 2015. Mainly Lloyds Bank, Tesla & Nestle which I have reinvested fully in Amazon. I am currently sitting on a large position in Amazon and Alphabet (formerly Google) both have had exceptional performance (49% and 51% respectively). Electronic Arts is up 19% (thanks DJ for the tip), The only loss for the year is Jardine Matheson Holdings, down 14%, it’s a very long term hold so no plans to sell any of these stocks in 2016. Remember that this is not a short term investment strategy.

The outstanding investment for me this year is Amazon. They are growing both in terms of traditional retail, but also AWS (Amazon Web Services) is a significant growth driver. I love the fact that Bezos has a very long term view and is re-investing in the business for growth and efficiency (Amazon Logistics, Cargo Planes, Same Day Delivery) all to improve the customer experience.

It’s my money!

Sometimes you enter a market and existing competitors don’t like it.

Unfortunately for them it is a free market economy that we live in and I can spend my hard earned money on whatever I want!

There are lots of areas that I don’t invest in and OK, like everyone we don’t get everything right on day one, but if we focus on our customers, deliver a great service and product then we will succeed.

If the market doesn’t like our products then we won’t, but without listening to customers and getting feedback we will never know what is wrong and go on to fix it.

Product-Market Fit is something that is very important to us, but it generally doesn’t start with getting everything right. It starts by understanding what is wrong (using measurement, not gut feeling) and fixing it!

I can look at companies, investments or competitors that fail to listen to the customer, most successful ones do listen.

So I am listening, but unless you are a customer please don’t tell me how to do things. If you want to take up the challenge and make a difference to a market we operate in apply for a job.

Fringe performance versus Startups

We have had fun sponsoring Confessional by Tennessee Williams in the 2015 Fringe Festival.

It’s an interesting story of a show that nearly didn’t happen as the sponsors pulled out at the last minute, leaving a large financial gap for the theatre company. Through crowdfunding and our sponsorship we filled the gap, but it got me thinking about running a fringe show and running a startup.

If you have been to the Edinburgh Fringe you will realise the massive amount of theatre, comedy, poetry and art that is on over 4 weeks in Edinburgh. Since I live in Edinburgh you notice the sudden swelling of the population, the busy restaurants and general improved vibe.

It’s a great time to be in Edinburgh and I am sure most performers think this is what it is like all the time.

Anyway, running a fringe company and grabbing attention is really hard, you are fighting for every single bum on seat for your show and the competition is stiff.

There is a massive amount of flyering happens during the festival. I am not overly convinced that this form of marketing really works (especially if you look on the ground around Edinburgh).

Marketing is around making emotional engagement and although most actors can captivate their audience, doing this on a busy high street while competing for attention is particularly hard.

In addition social media and PR have become a big part of the festival, creating content and sharing this does help get the word out – but the twitter blitz of Edinburgh Fringe makes that hashtag #edfringe pretty useless.

So are we consider channels for marketing at Brewhive, we do think the same way a theatre company thinks – how are we going to stick out from the crowd of other startups in our space and do something different. A great little video above shows that each day you need to get up and start again!

First pictures of Brewhive


So after exactly a year of planning we are launching Brewhive this week.

This is a pure play direct to consumer beer brand.

We have gained a lot of experience over the past decade in FMCG goods to consumers. We are excited about the opportunity and certainly the reaction we have from friends and family when talking about Brewhive has been very positive.

The core concept around Brewhive is still based on convenience and provenance. We let the hops do the talking rather than just letting them be a single line on the ingredient list.

Our core focus over the coming weeks is to gain approx 3,000 customers to test the proposition with. We want to gain feedback on what is good and bad about delivery, range, systems and pricing.

We have already lined up some interesting partnerships for later this year and plan to spend aggressively on customer recruitment and referral over the first 12 months of the brands life.

Interestingly we are avoiding subscriptions. Having tested Subscription v’s No Subscription we have seen a doubling of conversion rate without subscriptions. Products like Diet Chef lend themselves to subscription elements to keep you on track, but most consumers don’t like being tied in to subscriptions.

Brewhive update


So we launch early August (it has been a long journey and there were points we were going to give up!) but we are really pleased with the results.

  • We have a great launch range of beers
  • We have really spent time and effort to make sure the experience for our customers is fantastic.
  • We have done cardboard engineering beyond belief to ensure that the product gets to you in tip top condition

In addition we have made sure that our logistics operation is in place to deal with volume and speedy delivery (next day in most parts of the UK)

The journey to launch Brewhive has been quite a long one. We first spoke about it in July 2014 and it has taken over a year to get the brand and products to a stage that we are happy to launch.

To celebrate we have sponsored a fringe show Confessional by Tennessee Williams which runs from next week.

In an interesting bit of history my first job when leaving college was running 5 bars in the Assembly Rooms. Little did I know that many years later I would be launching a beer brand during the Edinburgh Fringe!

The Angel Investment Diet

I was lucky enough to be invited to join the table of Startup Grind Edinburgh at the EIE15 conference this week.

I talked to Phin quite a bit about investing and some of the selection criteria I use.

The most important tactic I have found for angel investment is “less is more”. I am sure this will not be popular with angel syndicates, crowdfunding site or gatekeepers but I certainly have found it to be a very important part of my investment strategy.

So a simple rule of investing in one company per annum has certainly been good for me. I mainly decided to do this as a way of me being able to cope as an angel investor. If you invest in a company the founding team do expect you to help – and being a full time executive means I have very little spare time. Investing in multiple startups at the same time is the same as starting multiple companies – a big no go to investors.

The reason investors spend time pulling together shareholder and employee agreements to restrict the number of things you do is the same strategy I use in angel investing.

So the next time you get a plan or meeting request across your desk, think if this was the only thing I could invest in for the next 12 months would I do it?

Just like dieting – less is more!

Growth Hacking

I spoke on Friday at a great event titled “Growth Hacking” in Belfast. Around 100 people crammed into a room to listen to a few speakers talking about managing growth.

It was mainly focused on SaaS and gaming, so I was there to talk about what Diet Chef did.

What was fascinating is that Growth Hacking as I can understand it is Direct Marketing in a new cloak. It’s about measuring and managing customer recruitment, retention and reactivation, something any catalogue or direct business has been doing for years (think Readers Digest!)

It got me thinking about measurement and including an ecosystem measurement metric with your “business mode”

This would be the best balance of New, Reactivated and Retained customers to achieve your business growth potential. If you don’t want to grow you can focus on retained customer more, but that can be quite a short term measure.

To stop people gaming things you need to measure these metrics in balance, but it was fascinating to see that the CRO of OMGPop (Draw Something) thought about marketing in a similar was to how we handle it at Diet Chef!