Daniel Hastik of Futurelytics: “Be Free to Make Mistakes”

Daniel Hastika StartupYard mentor who will be working with our Spring 2014 teams, is a serial entrepreneur and globetrotter. When he’s not tending to one of the first Czech based hosting companies from his home in Melbourne Australia, he’s founding new companies with the help of Seedcamp and Credo Ventures. And he manages it all remotely. Quite a feat, so we caught up with Daniel last week to ask him how he manages it all.

Read more about Futureleytics on their blog, and a bit more about Daniel at hrkavarna.cz (article in Czech). 
 
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Daniel, you launched Futurelytics in 2012 through Seedcamp. Can you share a bit of your founding story with us?
The co-founders know each other from university times; we have crossed in our professional lives multiple times in various IT companies across Europe. We’ve worked together in a consultancy for retail in Czech and also as advanced analytics consultants for a Nordic company. I’ve also been managing my own company over time as one of the first web hosting businesses in The Czech Republic, and had trouble recognizing patterns in my client base (thousands of clients) and Mirek helped me to find my most promising ones and get a rid of those that just consumed support hours. We thought that might be a good product and Jan, our colleague, has helped us to foster the models and we started to realize that we could really build something out of it. We applied to Seedcamp with this idea and were chosen from among approx. 800 other companies. From that time on our lives changed.
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You’re currently based in Melbourne, but your team is in Ostrava (Czech Republic), how do you manage that kind of responsibility remotely? 
We are building Futurelytics as a global company from day one. I’ve been on the move for the last 18 years and have travelled across the world multiple times. We believe that we have the right passionate people, self-motivated and responsible in what they do. We do not over-control, and everyone is taking their own responsibility in their actions. Freedom of choice is very important for us. Some people want to work on Sundays, some during the mornings .. there’s creativity in what we do and that doesn’t come with control. This way, we can have a distributed team. I’m responsible for business, and Mirek is product centric. We are really complementary in our day-to-day tasks and we move fast. Of course we are making heavy use of various online tools like Gmail, Hangouts, Trello, Harvest …
You’ve attracted some great investors, including our own partner Credo Ventures with Ondrej Bartos. What’s been your strategy for attracting investors, and what advice would newly-minted founders most profit from, when it comes to talking to VCs and Angels for the first time? 
Any startup that wants to impress great VC investors needs to be proven and/or backed by a previous Angel-type investor, an incubator or another trustable entity (apart from a great product and scalable markets). We are proud to be a part of the Seedcamp family in that sense.
The very first investors value the founders’ attitude, the team & their vision. By default we are different. At the very beginning we didn’t even know anything about startup buzz. Investors should see that you possibly have what it takes to be a great entrepreneur. Not being afraid to fall, working on your skills, networking and being open-minded are the prerequisites of an entrepreneur. That way you can execute any idea you could have.
Futurelytics helps companies to work better with their existing customers. What are some of the ways you do that? What are some of the biggest mistakes most companies are making when it comes to working with their customer base and managing their customer data? 
We let them discover new revenue potentials from various customer segments. So called “second-best” customers seem to be the most appealing information for marketers. Driving marketing campaigns by real behavior of customers inevitably brings their increased efficiency. Starting by lowering CPC, monetizing loyal customers and not ending by customer-churn mitigation we improve the customer lifetime value from several perspectives. Putting all these contributions together brings each engaged business a significant improvement.
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What do you think are the biggest areas of near-term growth for “big data” and analytics applications? What areas of the market are really interesting to you right now? 
There are technologies in place like Hadoop or Google BigQuery that handle tremendous data volumes in real-time. The real challenge seems to be to get some new information out of patterns and consequences in the data and put them in line with business specifics. We go beyond that thinking and bring-up specific recommendations for marketing campaigns on customer segments recognized. This is called “prescriptive-analytics”. We are eager to be pioneering in this area and closely cooperate on that e.g. with Gartner or Google.
You’ve had a varied career, from studies in Portugal to work in Africa, New Zealand, Australia, the US, as well as back home in the Czech Republic. You’ve founded 3 companies, and you keep on coming up with new ideas. What specific things have you learned through these experiences that you plan to share with our latest crop of startups at StartupYard?
I wouldn’t call it a career. There’s no certain strict lined path in front of me. I follow my passion “to create” and that comes from the freedom to make mistakes. And I’m not afraid to do so again and again. If you are not afraid to learn something new, not to be constrained by the past, to admit that you “don’t know” and ask for help, then the world is yours. You can train your instincts and quickly spot opportunities where other people see only issues and problems. You stay ahead the crowd and lead the way.
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The 3 Hardest Ways to Fail as an Entrepreneur

Being a successful entrepreneur is hard on its own. So being a failing entrepreneur is harder still. But as entrepreneurs, startup founders should be prepared for failure, just as much as they should be prepared for success. Failing well, though may seem like something nobody wants to know how to do, is how an entrepreneur sets him or herself up for future successes. In a game of high risk and high reward, you lose more often than you win, so losing well is key.

Here are a few of the hardest ways to fail as an entrepreneur, and what you can do to salvage something from failure.

1. Do Everything Right, and Still Fail.

Apollo 13: Some failures you can be proud of.

Apollo 13: Some failures you can be proud of.

I was fascinated by the recent demise of Outbox, a startup that promised to digitize and streamline the postal experience in the United States. By most accounts, Outbox did everything right. They had only 2,000 paying customers in one market (Austin, Texas) at their peak, but they had enormous brand recognition in the United States, and a waiting list of 25,000 customers in several other markets, including San Francisco. The company’s original goal was to partner with the USPS, and reroute customer mail to a local warehouse, which would digitize and digitally transmit user mail via email. Important documents could then be selected for delivery.

Long story short, the USPS killed the partnership when they realized Outbox’s potential for destroying the direct mail marketing business, by unsubscribing customers from mass mailings, costing the USPS potentially millions of dollars a year. An outmoded and failing government enterprise killed a cutting edge and potentially thriving new market, to secure an already weakened profit stream. Without the partnership with the USPS, Outbox would never be able to support customer acquisition costs and improve service density to the break-even point, much less profitability.

What you Can Learn From It

What killed Outbox was more than a structural problem. On the surface, the cycle they faced looked a lot like Pets.com, a popular, attractive, effective business from the consumer point of view, that just happened to cost the company more and more money, the more customers it managed to gain. But this failure was not founded on the idiocy that defined the rise and fall of Pets.com. Rather, Outbox made smart and effective investments into technology, a complex backend that worked well, and a level customer service that won them a lot of affection from customers. They did most things right, but it just turned out that doing most things right wasn’t enough to make money, or even to get back the investments they’d made.

The post office has been around for 300 years in the US, and so they were late by a few centuries. Even a vastly superior product has a hard time competing with that kind of a lead to market. But the founders of Outbox can leverage these innovations, and pivot towards a more profitable vertical, which is what they intend to do. If you’ve done everything right, you’ve put in the hours, and you’ve treated customers with respect and caring, and built a product that works well, it can’t ever be a complete failure. There will always be something in it that is of value. Possibly far more than you would ever have anticipated. Sometimes a product or service is just way ahead of its time- but the knowledge and connections gained, even in this failure, may well lead to something even better.

2. Do Everything Wrong

 

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As Paul Graham of Y-Combinator is fond of saying, most often, an idea that seems bad is actually a bad idea, or even if it is good, it may be fundamentally unworkable as a business. Or it may be impossible to grow. It’s the black swan, the idea that can work as a growing product and as a sustained business, that VCs look for, and that startups try to become. Because the best startups are ideas that seem bad, and are actually brilliant. Dropbox entered a geeky, techy marketplace, and delivered a product that my mom uses. Facebook entered a marketplace in which Myspace predominated, and beat them by being *less edgy*. WhatsApp was acquired for 11 figures for its take on an app that has been around since before smartphones. Those all seemed like loser ideas at the time, but there was something about each of them that just worked, from their marketing, to their backend, to their core concepts. They appealed on some level that allowed them to ignite and grow in a way that all their competitors failed to do.

But most of the time, perhaps 99% of the time, entrepreneurs will be involved in “all their competitors” and not in the one app in 100 that makes it to a massive acquisition or an IPO. Everyone here at StartupYard has been involved in one of these types of failures. The idea is good, but it depends too much on a community that doesn’t exist. Or the community exists, but no amount of pivoting seems to open a sizable, sustainable revenue stream. Or, after funding has come and gone, it’s found that the increase in size and revenue has still not yielded a profitable business.

What You Can Learn From It

Learning how to walk away from this kind of experience is painful. Especially when you’ve created a product that thousands of people really do use and love. But if you can’t make the business profitable, and you can’t make the business grow and open up new opportunities for profit, then you’re losing. No matter how slowly, you’ll still lose. So moving on and licking your wounds is an important lesson that most of us have to learn at one time or another- rather to own up to these mistakes and miscalculations as soon as possible, and move on with your knowledge and experience to something that has a chance at changing the world.

3. Cheat, and Fail

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Cutting corners and massaging the truth are attractive options for any startup with big ideas and not-quite-big-enough results. “Fake it till you make it,” is a truism among startups, but that’s a mentality more than a license to bend the truth.

Most of us have lied at one time or another, either to get a job, or to keep it, to get something we thought we deserved, or to keep from losing something we really didn’t. Very often, these little lies don’t come back to haunt us.

Colors is a great example of a startup’s chickens coming home to roost. Having pitched a totally unproven technology with a poor UI and poor user statistics for $41 Million in silicon valley, Color was in deep trouble two years later. Court cases and allegations later revealed a history of poor management and alleged fraud against employees. It bears repeating, now and always, that a high valuation for a startup does not make its founders rich. If anything, it has to potential for exploding a bubble, if there is one. if a company is based on lies and innuendo instead of fundamentals, eventually everyone will realize this. Unless you’re Frank Underwood  in House of Cards of course. In which case, this never happened.

What You Can Learn From It

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But if you actually intend to achieve the success you would like, you should expect that everything you say will, at one time or another, be scrutinized. Whether it’s embellishing your own resume, like Yahoo’s Scott Thompson, or lying about your metrics, to telling your investors that you’ve made more progress than you really have, the truth will eventually out. So cheating early is a guarantee of problems down the line.

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StartupYard Welcomes 2 more Czech Teams to the 2014 Accelerator

As we recently announced, 6+ teams have been invited to take part in the 2014 Accelerator at StartupYard. While this year marked a change, in that StartupYard opened its doors to teams from all over Europe, we still had an enormous amount of interest from within The Czech Republic. And not surprisingly, this is where we found some incredibly promising projects and teams. Here are 2 more of them:

How did you find out about StartpYard, and why did you decide to apply?

Pavel Nemec

Team From: Czech Republic

Project Area: News, Social Media

I’m in touch with a friend of mine who was in StartupYard last year, they created a site for babysitting – Hlidacky.cz. He told me how exciting it was being in this 3 month acceleration program. When I had this idea about our project, I knew that technical realization would be very difficult, because it requires us to collect a lot of data. When I read an article about StartupYard 2014 and its focus on big data and analytics I knew immediately that we had to take this chance and apply. 

  

Václav Formánek

Team From: Czech Republic

Project Area: Gamification/Education

As we are startup from the Czech republic, I think, we know all accelerators from here. There are not so many:) StartupYard combines three things we need very much – very good mentorship, contacts and money. Offices in Techsquare are a great bonus.

 

What attracted you to the idea of an accelerator, rather than bootstrapping or other sources of income (going directly to investors, crowd funding, etc)?

 Meeting a lot of creative and experienced people from business. Our team is open minded so we are hungry for new ideas and advice from experienced entrepreneurs. I think this experience could push us to the next level not only as a startup but also in our mindset. Being exposed to so many mentors and people from business can give you something you can’t learn at school or in a library. Also having the opportunity to meet data scientists from companies like Seznam, GoodData or IBM and talking with them about our project is just great and we are looking forward to it. 

Actually, we started our project more than two years ago, so we have already tried all of these sources. We started as a kind of crowdsourcing project with more than 100 contributors – developers, designers and authors of educational content, who invested their time to the project. Then we realized that it is very ineffective to manage so many coworkers, so some of us became founders and we have started to work as a smaller team and pay ourselves for work. We have already had appointments with potential investors, but we have had different visions, so we didn´t come to an agreement..

How is your team preparing for StartupYard?

We are preparing UX and the core of our application and of course validating the whole concept and target market. Also studying technology which could we now use thanks to StartupYard and companies supporting its program this year. From a logistical point of view, we are restricting all our other activities and responsibilities, so we would be able to make the most from these three months.

I definitely want to improve my English :).

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How did your team come together? How did you meet your cofounders?

Well it was 3 years ago, when I decided that I would spend one semester studying abroad as an Erasmus student. I sat on the bus in Prague and in that bus which was headed to France was my co-founder. It was really an accident that we met there and that we went to the same city. We became friends and we stayed in touch even after this Erasmus experience. So when I had the idea of this whole project I knew immediately that he is the right person.

 Ondřej (CTO) and me (CEO), we have been best friends for more than 13 years. We have discussed the vision of our product with hundreds of different people. Most of them liked it a lot. More than 100 people have been somehow participating in development of our project. The ones who remain, are the toughest ones.

Where do you see yourself and your company in 5 years after StartupYard?

We hope that the problem which we are solving will be associated with the name of our application. We want stable user community which we are going to listen and react to their needs. We would like to spread world wide and not only to English speaking audience which is our target market now. We want our application to be available in all platforms and all smart devices which will be here in 5 years.

If I look in the list of our planned features and ideas, I think we have plans for more than 5 years from now.

We would like our platform to be the best and most popular place where people can use gamification to share their knowledge. We would like it to run as sustainable as possible, so we can move to other projects, where we will use gamification and data analysis to make the world a little better place.

 What are you looking forward to most in Prague, both in the accelerator, and in the city? What are you nervous about?

We are both from Czech Republic so our excitement is more about acceleration process itself. 🙂 We are looking for meeting interesting experienced and creative people from business. I can’t say that we are nervous, we are just excited and we are looking forward for this life experience.

 All of us have been living in Prague for a long time. We are really looking forward to meeting great mentors and other teams.

How old are the members of your team, and what are their levels of education and professional experience?

I’m 25 years old and I have masters degree in computer science at Masaryk University. My studies were more focused on the theoretical part of computer science. Now I’m studying physics as a PhD student. Even though I love theory I also had plenty of working experience during my studies. The most exciting thing for me is the logic and algorithms behind this project. The other founder is 25 years old too and he is studying at the Czech Technical University in Prague. He is passionate about programming and he’s been developing websites since high school. The area in which he specializes is UX design and delivering the content to end users.

 Vašek, CEO, 27,  I will get my Master degree in International Politics and Diplomacy (University od Economics in Prague) in few weeks, I have a Bachelor degree in International Trade.  Since 2002 I have created, developed and succesfully finished many different projects in education (www.educon.cz/) and gaming, I am author of two theatre plays, and director of the documentary “Slumdog 50 cent.  I was one of the founders of NGO “Stop tunelům”, which achieved significant success in decreasing corruption in Usti nad Labem.

Ondřej, CTO,  29,  Master degree in IT (Czech Technical University in Prague) For more than two years (2011 – 2013) he participated in developing of groundbreaking education game called “Czechoslovakia 1938 – 1989” as a backend developer. Before that, he worked in Czech consultation and technology company Trask solutions for five years, where he achieved Senior java developer position.

Petr, 35, High school (High school of Art and Graphic in Jihlava) . Petr has been working as a freelance graphic and UX designer since 2005.

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Meet StartupYard’s New Teams

Meet 2 More of Our Incoming Teams

We closed our application process earlier this month, and we’re excited to announce that we have invited 6 teams to join the next round of acceleration, beginning in April 2014. 

As we mentioned last week, 6+ teams have been accepted and invited to Prague. We’ve collected their answers to our “getting to know you” questionnaire, and we’re sharing those answers here.

Teams to join StartupYard range from cloud based consumer services, location based mobile apps, and news aggregators, to search engines and data mining tools. The breadth of these projects is tremendous, and the potential we see in these teams, as well as their ideas, is really exciting.

How did you find out about StartpYard, and why did you decide to apply?

Václav Formánek

Team From: Czech Republic

Project Area: Gamification/Education

Nikola Todorovic

Team From: Serbia

Project Area: Cloud Based Consumer Service 

As we are startup from the Czech republic, I think, we know all accelerators from here. There are not so many:) StartupYard combines three things we need very much – very good mentorship, contacts and money. Offices in Techsquare are a great bonus.  

Well, I think I saw the StartupYard application on f6.com first. But also saw a post about you on netocratic.com. I have been in Prague two years ago for a couple of days and instantly fell in love with the city. This is one of the most beautiful cities in Europe and I’ve been in many countries and cities in Europe. I had a thought back then that it would be great to live here for awhile. So when I saw this application I googled around to find out more about the program and accelerator in general and I loved what I read. So here we are…

What attracted you to the idea of an accelerator, rather than bootstrapping or other sources of income (going directly to investors, crowd funding, etc)?

Actually, we started our project more than two years ago, so we have already tried all of these sources. We started as a kind of crowdsourcing project with more than 100 contributors – developers, designers and authors of educational content, who invested their time to the project. Then we realized that it is very ineffective to manage so many coworkers, so some of us became founders and we have started to work as a smaller team and pay ourselves for work. We have already had appointments with potential investors, but we have had different visions, so we didn´t come to an agreement.

Bootstrapping is fine. But you simply have to commit yourself full time to some project to try to make some business out of it. And if you get some investment you get the opportunity to do so. By joining accelerator you get some initial funding and a chance to use full potential that one good accelerator offers – access to mentors, a wide range of investors and so on… By bootstraping you do things slower and by accelerator much faster and the speed is of great importance.

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How did your team come together? How did you meet your cofounders?

Ondřej (CTO) and me (CEO), we have been best friends for more than 13 years. We have discussed the vision of our product with hundreds of different people. Most of them liked it a lot. More than 100 people have been somehow participating in development of our project. The ones who remain, are the toughest ones.

Svetislav and I studied the same faculty in Serbia. It is practically the best school for learning software development in Serbia. And Marko, the third cofounder worked as a designer on some projects with Svetislav for one company.

Where do you see yourself and your company in 5 years after StartupYard?

If I look in the list of our planned features and ideas, I think we have plans for more than 5 years from now.

We would like our platform to be the best and most popular place where people can use gamification to share their knowledge. We would like it to run as sustainable as possible, so we can move to other projects, where we will use gamification and data analysis to make the world a little better place.

We want to build a global, successful company. We believe we entered a great and prospective market, the numbers are great and if we do our job in the best possible way then that goal is achievable.

 What are you looking forward to most in Prague, both in the accelerator, and in the city? What are you nervous about?

All of us have been living in Prague for a long time. We are really looking forward to meeting great mentors and other teams.

The city is wonderful as I said and it would be a great pleasure to live in it. Also, we are great beer lovers and Czech beers are one of the best in the world. We can’t wait to try them all 🙂 But also we have to think about our company primarily so the focus is on the business. We are hoping that we can get the most out of this program, to meet great people who can help us build great company and of course, raise more money at the end of the program. We are not nervous – we are excited.

How old are the members of your team, and what are their levels of education and professional experience?

Vašek, CEO, 27,  I will get my Master degree in International Politics and Diplomacy (University od Economics in Prague) in few weeks, I have a Bachelor degree in International Trade.  Since 2002 I have created, developed and succesfully finished many different projects in education (www.educon.cz/) and gaming, I am author of two theatre plays, and director of the documentary “Slumdog 50 cent.  I was one of the founders of NGO “Stop tunelům”, which achieved significant success in decreasing corruption in Usti nad Labem.

Ondřej, CTO,  29,  Master degree in IT (Czech Technical University in Prague) For more than two years (2011 – 2013) he participated in developing of groundbreaking education game called “Czechoslovakia 1938 – 1989” as a backend developer. Before that, he worked in Czech consultation and technology company Trask solutions for five years, where he achieved Senior java developer position.

Petr, 35, High school (High school of Art and Graphic in Jihlava) . Petr has been working as a freelance graphic and UX designer since 2005.

27, 29, 30 years old chaps – I think the best age for starting a company. Svetislav and I each have 5 years of experience building various database applications, web applications, mobile applications and Marko has more then 5 years experience in designing for web and mobile applications. Svetislav and I also have a master degree in Electrical Engineering.

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