My startup story

In this post I share my experience as the CTO of now closed sofanatics.com service. Sofanatics was said to be one of the hottest startups in Europe at some point, but still we failed to make it big. The service is now closed and I feel like I need to share my startup experience.

How it all started

For me the Sofanatics experience started when Toni contacted me as he was trying to find great developers for his new startup. This was in January 2010. I believe he emailed me first and then I decided to give him a call. I had already known Toni for several years from his previous job at the finnish digital agency Valve.

During the call I told Toni that I don't really have any good tips on finding great developers that are free, but I might be interested to join the company myself. Toni seemed to be happy about the idea so we arranged a meeting.

I went to meet Toni and the other founder Sami at their office. I also knew Sami from before. By that time they already had a functional concept app that they showed me. We went through the ideas and the concepts they had and I was impressed. Something totally different than what I had done before. I said I would consider joining the startup. The I spent some days wondering what I should do. After a couple of days tinkering with the idea I decided to join them.

They already had some great ideas and a great founding team and they just needed some coding power. After one week I joined the company, Tuomas also joined Sofanatics. At that point it was clear to me that we could create something really unique (Tuomas is one helluva developer).

The tagline of the company was "You'll Never Watch Alone". This, of course, comes from the football team Liverpool's slogan (and song) "You'll Never Walk Alone". The idea was to connect all sports fans by creating a group video chat service where the fans could be together while watching football at home. Sounds like there is demand for that kind of service, right?

So we starting hacking the service together. The demo was created with .net so we first got rid of that (we joked it's the first bug we need to fix). We started building everything on top of Amazon cloud and RightScale.

The company got a seed round and was going to be supported by Tekes, the Finnish Funding Agency for Technology and Innovation.

So there I was. Coding for a startup.

Trying to find the right thing (2010)

The year 2010 was pretty wild. Our numbers were not growing too fast. We got new users, but not enough (you never get enough users). So while we developed the service further, we started realizing things that we could not see before. We did at least two pivots that year. The direction was from a closed video group chat to an open chat where all users could see each other. We pretty much ditched video chatting and focused on text based messaging.

Still it was about the match-time experience. Real-time messaging all along. We did everything in HTML so you could use the service with iPad and phones. But while opening up the chatting we started facing other problems. The biggest one was that if there were lots of people online posting messages, the chat started to become a mess. So we continued on concepting with new ideas. We also converted our app to the Facebook Platform. Users had to use their Facebook account to login to our service.

At the same time we got some great investors and advisors. We travelled quite a bit to meet different folks. We got some great partners like Chelsea FC and later FC Barcelona. Things really looked good and stuff happened all the time.

Failure to get big funding (2011)

Some time in 2011 we came up with a concept of a stadium UI. We would use the users' Facebook pictures as avatars. With that idea we were able to create a much more immersive experience than before. We could use the avatars to designate presence and give the users some easy ways to participate. On the stadium users could jump and cheers and use other easy actions to express their feelings. We also got rid of linear timeline of messages. The stadium UI was something really cool and unique.

Then in the summer of 2011 Tuomas left us for a great job opportunity in Shanghai. We all understood his decision but at the same time I was a little bit concerned about our future. He had created big parts of the service and all that would be for me to maintain. For example, at that point there were well over 50 database tables, massive autoscaling deployments etc. I was able to work with the codebase pretty easily, but being pretty much alone with that amount of software (and all the cloud stuff, configurations etc) it certainly slowed our capability to innovate on new stuff. We had to introduce new features every now and then so there wasn't that much time left to work on totally new things.

Then in the fall of 2011 we failed to close a major financing round from the US. We basically had a deal with a top-tier San Francisco based VC. Our guys flew over to meet them at least two times. We (as a company) spent a lot of time on that financing round. We thought we would be able to close the deal, but something totally different happened. They stopped all communication with us. Suddenly. No explanations. No apologies. Nothing. We were in trouble.

We added gamification features to the service. Stuff like points, badges, ranks. Some of that stuff worked pretty well, but some of them really felt like taken from another service. We learned that it's not natural to "add" gamification to an existing service. Ranks worked pretty well because it is based on natural use of a service. We also kept on adding new features to the stadium. Slowly but surely things were progressing.

After the failed round we were able to secure some partnerships to get some revenue and keep things rolling. Our existing investors also helped us in an attempt to give us more time to sort things out.

Trying hard (2012)

In 2012 we continued our work as usual. We partnered with NBA on the NBA finals. That partnership was short but successful (the patnership would have continued next season). NBA had our stadium embedded on their Facebook page. It turned out that conversions were really good inside the FB ecosystem. Much better than on our regular site. The engagement numbers were good as well. We measured time on site in tens of minutes instead minutes.

We also worked hard on mobile app concept. Actually we were able to produce almost fully functional mobile app. We would have needed about two more months to finish up what we had been working on. It would have been beautiful :)

Then after doing pretty much everything we could, the service was closed down in the beginning of September. Sad stuff, of course. I am still upset about how things went, but hey, that's life. Gotta go forward.

Things I learned

Team matters, great people are great

I had a pleasure to work with smart people during the time at Sofanatics. Especially in the beginning, we were four guys with strong will and a decent amount of experience from the industry. Everyone tried to push to some direction and it wasn't always clear where we are heading. But with smart people things tend to sort out eventually. Team members find their places and start knowing each others' strengths and weaknesses. Things just get done and direction gets more clear. This of obviously depends on the product you are building. If the roadmap is clear from the start and you're not doing pivots, then it's probably easier.

I think our team's biggest weakness always was the lack of a full-time kick-ass designer. We had some great designers working with us but we failed to get the best out of them and eventually failed to keep them in the team.

Be lean and try things

We were very lean from the beginning. At times maybe too lean and agile. We deployed new stuff to production nearly every day. Except on Fridays. We maintained a backlog on Pivotal Tracker and then selected tasks for the week every Monday. So it was something like Scrum, but we did not practice it literally. We were really quick in testing out new things. With metrics data we were able to see the effect of our work.

Money matters

I like startups that have a business model that can work from the beginning. We also had various ways we could have monetized the business, but we did not get quite there. We would have needed more users and eventually did not have enough marketing budget to grow the user base.

If you can say that you can make 1000 euros per month with 10 000 users, then you can tell a potential investor that you would be able to make at least 10 000 euros with 100 000 users. It's great if you can tell you can generate revenue and scale it up. Revenue stream can possibly also protect you against failed or delayed rounds.

Without money it does not matter how good your product is unless you can bootstrap it (which is a fine option too).

Focus!

Focus on getting stuff done and out as fast as you can. Don't try to do many things at the same time because that way it will be harder to measure and analyze what you did. Also, doing many things in parallel will result in many half-thought features.

Name a product owner

You should have one single person in charge of what will be done and when. When many people get to decide the end result is a mess.

Figuring out totally new things is hard and not always needed

When you're working on an unknown territory such as Social TV, you don't always have a way to benchmark your stuff. So, when you are thinking about new features, try to think if you would use it yourself. Sometimes you can copy things from entirely different industry. For instance we studied the way gaming companies are doing things.

Listen to yourself

The world is full of people who come to you with a list of things you should/shouldn't do. Some of these folks are very clever and experienced, but still you need to remember that they are not running your service and probably don't know that area as well as you do. Use your own brains to filter out the good stuff and ignore everything else.

What was it like to be a CTO of a (hot) startup?

Probably not the same as being a CTO of a bigger and more established company. You have to DO things, that means development, concepting, meeting investors etc. At the same time you get a lot of freedom to try things and get great advice when you need it. It was a great experience. Period.

Closing words

Phew, I feel a little bit lighter now that I was able to write this article. Now just upwards and onwards - to new challenges!

I'd like to thank our great users, team members, founders and investors. Thank you for making the Sofanatics rollercoast ride possible!

Cheers, Kai

 

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