The startup that didn't make it

Most of what gets written about startups is written by the survivors. That is a shame, because the businesses that do not make it tend to teach you more, and they teach it faster.

StepJockey was a health and wellbeing product that promoted physical activity in the workplace. It came from a simple idea: if we label food for calories, why not label staircases for calorie burn? We built a mobile app, a web dashboard, and physical signs that went up in buildings. We had an experienced founding team, a research grant, blue-chip clients including Comcast, the NHS, the Ministry of Justice, Deutsche Bank and BNP Paribas — and in 2019, after five years, we ceased trading.

Here is what actually happened, and the things I still use.

2014–15: the early days

An SBRI grant funded research into the actual calorie burn of stair climbing and the behavioural science behind visual prompts. That paid for an MVP — the app, the dashboard, and an online ordering facility for the signs. The signs themselves went through a properly iterative, user-led process before we settled on the final content and design.

The first trials and paying clients gave us a wealth of feedback. They also gave us our first real lesson, which was slightly humiliating: the online ordering facility we built never got used. We had spent time and money on a feature nobody wanted, because we assumed rather than asked. Every part of the product that had been through user research worked. The part that had not, did not.

The other thing that stood out from those early days was where our money came from. Our first investment arrived through the founders’ networks — connections, not cold approaches. I have taken that seriously ever since. Record who you know, keep those relationships warm, and understand that a network is an asset you build years before you need it.

And with a tiny team, process is not bureaucracy — it is the only way to get any leverage at all. Simple processes, introduced early, are what let three or four people behave like ten.

2015–16: raising, and spending

We raised £600k and grew the team across sales and tech. On paper this was the good bit. In practice it was where the cracks started.

Recruitment was harder than expected. Internal disagreements led to the COO leaving. We spent on tech — a refreshed marketing site, new mobile apps — and grew a team split between London and Cornwall. We pivoted to B2B, targeting HR and wellness professionals in organisations with more than a thousand employees. For the first time we had a full board and shareholders to report to.

Three things I took from that period.

You need someone who owns the product. If you are building a digital product, product focus cannot be a shared responsibility that everyone contributes to and nobody leads. It needs a name against it.

Product-market fit gets much harder when the buyer and the user are different people. We were selling to HR and wellness managers, but the product was used by employees walking up stairs. Satisfying one does not automatically satisfy the other, and it is easy to end up optimising for whoever signs the cheque rather than whoever has to use the thing.

Spend the money. When an investor puts money in, they want to see you create value with it. Being cautious feels responsible and is often the opposite. Be decisive, make the difficult calls.

2017–18: lost direction, then reset

2017 was the year it drifted. Team changes and inconsistent sales meant we lost direction — not dramatically, just gradually, which is worse because it is harder to point at.

Our existing investors gave us a lifeline in 2016 and again in 2017, but there were redundancies. By the end of 2017 patience had run out, and the board asked the CEO and founder to step down. A new CEO came in with a wealth of business experience, the board was shaken up, and the business was reset — another pivot, this time to facilities and building managers and real estate, with a focus on client services and delivering a programme rather than a product.

What I learned in that stretch has shaped how I work more than anything else on this list.

Culture and leadership are multipliers. A strong culture multiplies creativity and productivity. And if you are building a product, a diverse team building it only makes it better — you are designing for people unlike yourself, and it helps enormously to have some of them in the room.

Investors follow their money. The hardest part is getting an investor on board in the first place. Once they are in, keep them engaged and up to date, and they will very often follow on. The founders who go quiet between rounds make it much harder for themselves.

Have a functional board, not a supervisory one. A board made up of investors guarding their investments will watch you. A functional board will give the operational team guidance and support. The difference is enormous and it is worth fighting for at the point the board is being formed, because it is very hard to change later.

2019: so close

The new approach was working. Clients renewed and expanded their accounts. But the model was expensive, and we became reliant on our chairman for cash flow funding.

In the first half of 2019 we engaged an investment advisor to raise a substantial round. We had a new app in development. And we secured a letter of intent from Comcast to roll StepJockey out across their entire portfolio — 45 sites worldwide.

Then a set of circumstances collided and we had no option but to cease trading.

That is genuinely how it happens. Not one catastrophic event, but several things arriving at once against a business with no cash buffer and a funding round that had not closed yet.

Investment takes far longer than you think. From realising you need money to money actually being in the bank is six months, minimum. If you are a founder, internalise that timeline and keep potential investors warm long before you need them. We started the raise while we still had a runway; it was not long enough.

Understand your responsibilities as a director. Putting a business into liquidation is a stressful time for everybody involved, and as a director there are legal duties and responsibilities that are not always obvious until you are in it. Know them before you need them.

What it was worth

I do not think of StepJockey as wasted time. The metrics for success do not have to be monetary. I learned more in those five years than in any period before or since, and almost all of it went directly into building Hiyield — which became a B Corp, a seven-figure business, and eventually an exit to an Employee Ownership Trust.

The specific things that carried over: test assumptions before you build, put a name against product ownership, keep investors close, build a board that helps rather than watches, and start raising six months before you think you need to.

None of that is theory for me. Every one of them is something I got wrong first.

If you are somewhere in the middle of this — the drift, the pivot, the round that is taking longer than planned — it is worth talking to someone who has been through it. That is most of what I do now.