I just had my largest failure ever. Shutting down my 1-year project before launch.
For over a year I have been working on DashVest (dashvest.com), a peer-to-peer lending platform that rewarded good financial habits.
Last Friday I made the heartbreaking decision to close down before we even launched publically. In the last 12 months, I have spent about $45K of my own money trying to get this off the ground, only to run into blocker after blocker.
It was an ambitious idea from the start, but I wanted to bootstrap it the entire way. My agency (yabhq.com) gives me a steady paycheque, and I really wanted to help open up the financial lending space to entrepreneurs and freelancers (the people who have the hardest time getting loans).
Over the last year, I was met with dismissals, insults, and complete disrespect. No one was taking us seriously, even the consultants we were paying! I wanted to do everything by the book and have all the regulations in place, but maintain our special sauce.
In the end, I finally threw in the towel. I wanted to bootstrap this business so bad, but it seems in this space, you need to go raise $X million of dollars just to get started. I'm not cut out for that, nor do I think I'm the right fit for that.
We worked tirelessly on the UI, and really tried to simplify the experience. This is my largest defeat ever, and it's definitely taken a toll on me lately. I hope someone takes on what we wanted to do with DashVest someday. I think the world needs it.
Sorry it didn't work out! The landing page looks great. Businesses in regulated industries sound like a massive pain. I'm not sure I could do it. Too much control taken out of your hands, and too much upfront expense. But that's also a competitive advantage, as others don't want to try it (see: Stripe).
Any big lessons learned that others should know? What will you do differently next time?
I hope there's a next time!
I've been replaying the "what would I do differently" in my head over and over. It's hard to say, but I think I would have gone done the regulation route earlier and forced the issue more. I think finding someone early on who is more progressive would have been great for us.
Ideally, I would have partnered with someone in the industry, felt the same pain points as me, and was passionate to change them.
Chris,
Had a very experience in the home services sector.
Lost a really big chunk of change and a year of my life.
The decision to shut down is hard and there's no Hollywood ending.
I feel this on every level man. Let's go get a virtual beer together. We could both use it lol.
Sorry to hear, but thank you for sharing. Were there any positives you drew from the experience?
I learned a lot about the financial industry in both Canada and the USA. The systems are so different in terms of transfer protocols, that it really made we respect services that transfer money between different countries (huge respect for TransferWise who has to cover dozens of countries).
Sorry about that. My question is if there is a chance to make it open source? In that way maybe you can find resources, especially for consultants.
Thank you for sharing. Hopefully the next venture will be successful.
Hi Chris, sorry to hear about the shutdown, (hopefully there's a path back later).
I looked at the site and got a warm and fuzzy feeling when I saw it was based in Barrie. I lived there from '96 to '08 and am a Georgian grad. Now I'm over in Vancouver, and I sure don't miss the snowbanks on the 400 haha. But, I do have rain 5 months of the year, so there's that.
Hi Chris, it seems to me we have similar points of pain. I am working on a project in the same area for a few years(yes, years, not months) and there is a much we could exchange between us!
I find your idea could be made fundable at certain conditions and maybe you should give it a new try - of course, if you still wish to make it a reality. Since I didn't see your project docs, my thoughts are based on your post and the site only, so - please, excuse me if I am missing something.
Actually, you have shrunk the total target of your product - there are many more customer groups for such service, worldwide. So you missed showing the scalability of the project.
You have a team, that is great in building the tech side of such business, but not the market and the financial side. Any alternative financial services platform must have an interdisciplinary team. The technology is just the driving motor to make things more fast and easy to happen. But to give a real solution for your target you need team members and experienced consultants who brain with the same pain as you and your customers. (It seems you had really the wrong consultants.)
Such a project needs entrepreneurial professionals who either have the same vision and wish to create a solution or who already worked on similar projects and made them happen. Look at the teams and advisors of the disrupting digital banks, money transfer services, e-payment institutions and search the advice of their consultants.
It is also a high-collaborative business - nobody can do it alone and there is no need to develop all alone. Collaborating with the right partners will boost your project more than you can right now imagine.
As for the page - it's a good starting-now-page and there is much to be improved. We can go in detail later if you still wish to proceed with this project.
Finally, about your financial concerns - even most of the financial startups are pumped with millions by venture capitalists, it is not always the case and sure is not the turning point of success of your project. There is always an alternative way to fund your business.
I don't know for you, but I am one who never forgets my own ideas and projects with which I have failed. Some of them I made happen again, others are in the waiting line, still but I believe that there is such thing as the right time for the right idea.
What about customers?
You tried for a full year to do something. Not many people have the guts to try an idea, let alone stick at it.
The idea is a good one and it sounds like you still think so. Its a shame this one didn't work out but you should be proud that you tried something, learned a ton along the way and got through the experience.
Don't be too hard on yourself mate. No one knows if these things will work out until they try :)
oh dude, I'm sorry man. This is going to sound stupid but... when I first heard Eric Ries talk about Lean I remember one thing that stuck was that a startup's value is not measured in revenue, traction, etc etc. Instead the currency is the learning. You can look at a startup where all the usual metrics show a fail BUT if you've learned a bunch of stuff then actually you've come out on top.
The point is, see this as a massive learning and take all that with you on your next venture.
And also have a massive beer/wine glass/mineral water/yoga sesh whatever unwinds you :-)
Bootstrapped moonshots like this are a great thing. I didn't work out for you this time, but I think the spirit is something you shouldn't lose. There are too many B2B SaaS products out there right now who play by the playbook, you tried something different.
I think it's a good thing that you were trying to create a proof of concept, even if it didn't work out this time. There are VC funded business out there who do the same, but also lay off 100s of people and waste $100MM in the process. I am sure you have learned a lot (at least the cost worth) and I strongly believe that you will come out of this stronger.
Handling regulated industries will be hard forever, but I am glad that you tried! It's a good aspiration to have and looking forward to your next thing.
Aside from dismissals, what were the actual blockers that you hit? Was it around regulations, or something else?
It was regulations mostly, and the consultants we hired not willing to do things differently. I had created a process in which a person's loan would have its interest rate reduced year over year as they maintained a good payment history. For whatever reason, I just kept being told this "couldn't be done", but nobody would ever answer my simple question of "Why?".
What did the consultants do to block you, besides naysaying? Were they literally just refusing to do the work you paid for? Regardless, sounds frustrating!
I don't think you should ask any consultant why something can't be done. It requires a lawyer that understands international law and regulations. You will need an approval from multiple governments before starting and that requires millions!
The consultants were lawyers. We had a law firm and a financial compliance company that was handling compliance regulations per US state.
I've also had a hard time working with lawyers. I wanted to do something different and they seemed unwilling to help me navigate the legal landscape of it. I feel like if you want to break barriers or innovate "It's Better to Beg for Forgiveness than to Ask for Permission." So do the thing, then when the feds come after you, lawyer up. Seemed too risky for me personally tho. Wish it worked differently.
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