“3 reasons I invested in our own startup” by Mike Hann, our VP of Sales

With all of the great things that come with joining an early stage startup, one of the least exciting aspects is the “startup salary”. Trading short-term earnings for shared success in the future potential. This was the position I found myself in when I joined the founding team at our startup Poq. Salary poor; option rich!

So if you have already traded cash for options, why would you ever consider investing actual money into the startup?

Glad you asked! To give it some context, we’re 85% committed on a round of £500k growth investment, so I didn’t need to invest, but here are the three reasons that I chose to do so:

1. Product/Market Fit

As Marc Andreessen puts it: “product/market fit means being in a good market with a product that can satisfy that market.”

One interesting point here is: broadly speaking, our product has always satisfied the market. The challenge is measuring to what extent. Since platform development began in Sept 2011, the product hasn’t fundamentally changed; it’s still cloud-based SaaS (for native apps). However, the fundamental change over the past 6-9 months is that the relevancy of our solution is much more aligned with the enterprise market – where being cloud-based SaaS means we can solve real problems.

This is an observation made in The Innovator’s Dilemma with technology companies trying to provide better products than competitors to the point that they often progress faster than market demand. But with the enterprise market demanding a solution like ours to help them scale and innovate on mobile, it has allowed us to grow our recurring revenue by 50% every quarter this year, which is set to continue into 2015.

Goldman Sachs predict mobile commerce to more than treble by 2018 and with retail apps being the fastest growing segment of mobile commerce (Internet Retailer) it appears that demand will only get stronger – certainly comforting to know when investing further into a company.

2. The Billion Dollar Opportunity

The enterprise ecommerce market opens us up to a huge market opportunity with similar companies in our space realising billion-dollar exits (Demandware IPO with current market cap of ~$2 billion, SAP acquiring Hybris for $1.5 billion and Oracle acquiring ATG for $1 billion).

Arguably, the stakes are even higher now with the above companies founded in a desktop-first world, which mobile has now completely disrupted. Global Ecommerce and Global Cloud also continue to grow (predicted 14% and 20% CAGR respectively over the next 3 years), as well as the potential for native apps to have a larger piece of the retail pie than ecommerce ever did with technologies like Apple Pay coming to market. This is why our big, hairy, audacious goal is to transact more sales than any other ecommerce platform globally.

To put this into perspective of why I invested, comparing our current valuation to a $1 billion exit would make for a return of around 160x. Where else can you get anywhere near that return!? The actual amount is skewed in comparison with my existing options, but regardless of how many options I already had, this is still a significant ROI opportunity that I couldn’t ignore.

3. Incredible Team

Last, but certainly not least, is our team is full of A-Players. I’m very thankful to work alongside such a talented and passionate group of people.

It makes hiring a lengthy and tiring process, but it’s so worth it when you see what huge results that a small team can produce. We have a saying internally of “solving problems with technology, not people” and it’s great to see it come to life.

We’re also fortunate to be led by our CEO, Oyvind Henriksen, who has an incredible vision for the future of ecommerce and the domain expertise to pull it off. Walter Isaacson described Steve Jobs in a fitting way to how I would explain Oyvind’s leadership: “Some leaders push innovations by being good at the big picture. Others do so by mastering details. Jobs did both, relentlessly.”

Our mission may be big, hairy and audacious – but we have a huge opportunity, with the team and the tech to execute. We’ve already raised £440k of our £500k investment round to fund further growth, platform development and rebrand. We have £60k remaining and you can invest anything from £10 on crowdfunding platform Seedrs – so join us for the ride here.

Post from our VP of Sales, Mike Hann

Update: Our fundraising round is closed and we hit 169% of our initial target. Read more here.

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