We had a chat with Oisin Hanrahan to learn a little more about what lessons he learned from founding Handy in 2012, raising $100m+ of venture capital, scaling the company through its acquisition by ANGI, and eventually transitioning to become the CEO of ANGI.
- Biggest Misconceptions About Starting A Company
Running a company is very different than a regular job. You have 150 things coming at you, and there is a very big mindset shift to understand that your role as startup founder is not to get everything right, it’s about figuring out what are the few key things that move the needle.
For most companies it is pretty simple. Are you selling something that people want? Are you running out of money? And is your team broadly happy?
Just accept that you’ll suck at certain things. You are gonna get on “C” on 80% of things — success at the early stages is really just figuring out the few things that you need to get an “A” on.
2. Your Role Changing as You Scale
Early on, you are going to be a big part of almost every area of the business. As you scale you are going to be involved in a lot less and your relationship with the leaders of your teams will need to become a lot more trusting. You’ll need to hire slightly different people, and they’ll need to have more autonomy than they have had historically.
Your cadence of check-ins says a lot about where you are at with your team. If you have a sales check-in every Wednesday, and by Friday you are already feeling antsy, and Monday you feel a need to ping your team for an update, it is a pretty good indicator that you haven’t built the necessary relationship with the person leading that team yet or you just aren’t ready to let go of some of your control.
3. Some Lessons Learned from $100m+ of Institutional Fundraising
- It always takes longer than you expect it to take.
- Unexpected things will always happen.
- It is always less structured than you want it to be.
- You shouldn’t run the business with fundraising in mind, but being cognisant of it is good practice (i.e. try not to make a major pivot in business or significant change to your leadership team right before you start a raise). When you are raising money, make it is as easy as possible for an investor to say yes.
- When thinking about your “target investors”, try to be as close to the “middle” of their portfolio as possible (i.e. if they specialise in $5m B2B SaaS businesses, and you are a $1m Consumer Tech business, it doesn’t matter how much they love you. The people they are connected with and the benchmarks they have in their mind about their portfolio will affect the way that they think about your business).
Note: this applies mostly when you have choices, sometimes you should just take the check.
4. Thinking About Competitors
Generally, most companies die from suicide not homicide, but there are some caveats to that. Venture investment can really squeeze the air out of the room if they really pump money into a competitor. If a competitor gets funded 10x more than you (e.g. $50m vs. $500m), you’re not playing the same game. You’re not even playing the same sport. A billion dollar exit isn’t on the table for them in the same way. Just continue to think about the opportunities that a massively funded competitor probably can’t focus on as well as you can — maybe you can service the long tail a lot better. There can be significant markets, customer segments, etc. that you are best positioned to serve.
The Full Interview
To listen to these takeaways in more detail, and hear about when he knew he tapped into real demand, how to design a marketplace, and when he decided it was the right time to sell Handy, you can watch the full interview on YouTube.
About Junction Venture Partners:
Junction Venture Partners is a new early-stage fund, currently focused on businesses in overlooked niches. In particular, we are spending a lot of time thinking about Vertical SaaS, Marketplaces, tools for SMBs, and Commerce Enablement. Junction is led by David Olk and David Birnbaum who together have been operators, investors, and advisors of early stage companies for the past twenty years.