When your startup fails

A startup begins as an idea, an inkling. Maybe the founder sees a pain point and thinks they can solve it with a bit of technology and shift an industry, but it doesn’t always go quite as planned. That’s what ShelfLife founder Lillian Cartwright found when she launched her startup. As the economy turned last year, and venture capital dried up, Cartwright was forced to shut down her company, taking the painful lessons she learned and moving on to whatever comes next.

When she started out, though, Cartwright believed that the beverage industry was ripe for digital transformation. While she was in graduate school at Harvard a few years ago, she came up with the idea of starting a hard seltzer business. She soon learned that sourcing the ingredients was harder than she imagined, and she began to envision a business, a two-sided marketplace where companies could find ingredients, negotiate a price, and invoice and pay — all in one convenient place.

It sounds like an idea an industry caught up in paper and manual processes would embrace, but Carwright would learn that she might have moved a bit too fast, especially on the accounting side of the business.

When you think about digital transformation, it’s easy to forget that long held manual processes can be hard to change. For a startup taking aim at an industry still mired in phone calls, faxes, email and paper invoices, even if digital is more efficient, even if it can save money and time, it’s not always easy to change entrenched company workflows.

“I was struggling in terms of understanding the supplier landscape, figuring out who would supply our juice concentrate, citric acid, cans, labels — all of it. In talking with other brands about what some of their issues were, I began to realize that there was an opportunity to open up this process and bring more transparency to it,” Cartwright told TechCrunch+.

At about the same time Cartwright was struggling with her seltzer business idea, she had a summer job at Bessemer Venture Partners, looking at e-commerce marketplaces. Without really knowing it at the time, she was laying the groundwork for her startup idea.

The business launched in February 2020 just as the pandemic was taking hold, perhaps an omen of things to come. But early on, everything looked rosy: She managed to raise over $300,000. She used that money to seek out a more technical co-founder. Eventually she partnered with John Cline, an experienced engineering manager, who had had stints at eBay, Blue Apron and Google before joining Cartwright to help build ShelfLife.

So far, so good

With Cline in the fold, they began building the platform. By the following year, she raised another $2.7 million. The platform began coming together. The future looked bright.

When your startup fails by Ron Miller originally published on TechCrunch

source https://techcrunch.com/2023/04/09/when-your-startup-fails/