Jul 26, 2017
People have ideas for companies all the time; sometimes they come from personal experience, sometimes they come from a hunch. Some ideas are good and some terrible. Very rarely, does an idea moves past that stage to become a product or feature; even more rarely, does that product become a company; and, almost never, does that company becomes a successful company. Usually, for an idea to become a company, an entrepreneur needs the following attributes: intelligence, energy, charisma, stubbornness, and luck. A founder also usually needs to rope in cheerleaders and champions along the way.
Over the past couple of months, both Andy Weissman and Fred Wilson of Union Square Ventures have written excellent blog posts about why they a huge investment opportunity in the MetaProp NYC portfolio company Flip. Posts like these as well as an ongoing content marketing effort has helped Flip grow its customer base significantly over the past few months. Like all startups, as evidenced by the comments on these posts, Flip still has its fair share of super fans and skeptics. While the company still has a long way to go, customers are seeing the pain point and using the service. Although it is very much still a nascent business, Flip has made the transition from idea to product and now recently to a company. The next challenge will be executing on the vision.
I’m not writing this post to extol the value of Flip (although I think it’s immense), or even to discuss the company’s business model. Instead, I would like to take the opportunity to show aspiring entrepreneurs what it takes to turn an idea into a company: the correct mix of intelligence, energy, charisma, stubbornness and luck combined with a stable of cheerleaders.
In March of 2015, MetaProp did not yet really exist. Aaron and Clelia, in anticipation of the upcoming public launch of our accelerator program in August of 2015, were pushing me to “get out there more” by doing things like panels and thought leadership. The executives at the Paul Milstein Center for Real Estate at Columbia University were kind enough to allow me to moderate my very first panel on PropTech at the University. The panel was a big hit and featured really interesting startups like Compass, Honest Buildings, Travtus, The Square Foot, and SiteCompli.
After the panel I was bombarded with students from the business school coming up to me and pitching me on their ideas for a startup. After the mayhem subsided, one final student came up to me and explained what she was working on. I can’t remember exactly why I decided to pay attention to her as opposed to the others; maybe she seemed more poised and less scattered. Regardless, she mentioned that she and her classmates were experiencing frustration with the rigidity of the current apartment lease structure and she was building a product to help ease this pain.
I was intrigued and gave her my email address to follow up. Below, please find a screenshot of that original email:
The following week we decided to meet at a Breather space near my office for a white boarding session. One of the things I liked about Susannah was that she really lived by the Lean Startup methodology. Between the time she had emailed me and the time that we met a few weeks later, she had already released a prototype of her product in private beta with her friends up at Columbia. She had received feedback on the product and was already iterating.
We discussed everything from residential leases to commercial leases to a vision of the future where leases exist on the blockchain and are completely fluid. I could tell almost immediately that I wanted to invest in this company, but I wanted to make sure that she was going to do it correctly. I told her that she needed to find early investor champions as well as a co-founding Chief Technology Officer if she really wanted to make a go of it. I also let her know that an accelerator would be a good idea and she should apply.
After another month or so, she was ready to graduate business school. She was taking a venture capital class that I had taken a few years before with Stu Ellman and Will Porteous of RRE Ventures. We took the deck that she created for that class and got her some very valuable angel investor introductions with that, including Joanne Wilson, who became an early champion for Susannah and ultimately joined the Board of Directors. The deck can be viewed here. It’s certainly come a long way since then…
The next major domino to fall, and in my opinion when Flip made the transition from idea to product, was when she began the TechStars New York accelerator program in the Fall of 2015. Alex Iskold, the program director, immediately understood that Flip could be a massive business. He also understood that Susannah couldn’t do it on her own and needed a strong technical co-founder. Luckily for both of them, Roger Graham was hanging around TechStars at the time and entertaining many different offers. A talented full stack engineer, Roger was unfortunately feeling the pain of carrying three residential leases at the same time. He joined the team within a week and they were off to the races.
In the Spring of 2016, we began to discuss with Susannah the possibility of Flip joining our second MetaProp NYC accelerator class. While she was now steeped in technology and the startup industry, she had still never had a job before in commercial and residential real estate. We could offer her a 22 week crash course that she needed on the industry itself, and how to navigate within it. We were lucky to convince her to join, and she became a valuable contributor to our forum sessions. Since she had already gone through TechStars, she was able to serve as a mentor for some of the younger entrepreneurs in the cohort, especially the co-founders of Bowery Real Estate Systems.
Fast forward to the summer of 2017 and it’s safe to say that the idea has now become a company. Thinking back to that first meeting at my panel in 2015, it’s amazing to reflect on all they have built in such a short time. However, now the truly hard work begins. She now has a working product, product/market fit, a great team, and fantastic investors behind her. It’s time to get to work!