A short story of my Company, how I went broke and life lessons

Here at An Entrepreneur Blog, which currently belongs to my consulting firm 360° Consulting, is a project that was created originally with its Spanish version in mid-2009. That means that currently the blog has just turned 6 years old. During this time, I’ve shared my knowledge, mistakes I’ve made (so others avoid them) and more. Currently my sister María Fernanda Gómez writes this Blog with me.

In many articles I’ve talked about “my company”, the one I created over 10 years ago, which went broke and where I lost money (that I’m still paying off). Few times I’ve explained more about this entrepreneurship adventure and I know many people have asked me about this. For several years I have thought of writing about my company, initially as a video post, but today I decided to write about it in this post. I won’t share names and some other aspects, as they don’t add value to the story.

An Entrepreneur since I can remember

If there is a trait to describe me, is that I’ve always had an active inner dialogue with myself. I’m always thinking, creating new ideas, analyzing my next move. I think even when I go to sleep, I keep thinking and dreaming. And this has been my life as far as I can remember.

In my close and not so close family circle I’ve had many entrepreneur models, some quite successful. I grew up having them as reference and although I currently don’t look up to many of them, they were inspiration models. To this I have to add that when I was about 10 years old my father got fired from the company he was working at, because they decided his job position “didn’t existed”. This was a hard time for my family and although we endure it was clear for me that I didn’t want to work for someone else.

From a very young age I also had a close relationship with technology. I was very curious and when I learned about the Internet, my life changed. Back then (it was about 1997) and I was still at my high school I realized Internet was the future and that you could make money out of it. A couple months after my first contact with Internet I had my first webpage and some time later I was making some money, without even graduating from high school.

When I enrolled at my university to study Systems and Computer Engineering, it was clear that I wanted to create a business of my own. Several situations that occurred between 2000 and 2001 made me realize that small and medium sized companies will require to have websites, something that was quite expensive back then. I saw a clear market opportunity and I decided to seize it.

With several of my classmates, who were about my age (18 to 20 years old) we created a project that later became a business. We submitted our business idea to several contests and were successful, especially in one held by a major magazine in Colombia, our country.

One year before I graduated from the university, I decided to take a year off to search for investors. It was 2004 and this was a hard search. Some family members provided a small seed capital, which allowed us to open a small office and hire the first employees. Later we were able to secure a large bank loan.

During all this time I made many mistakes, that today I consider a blessing, as they taught me many things that other way would had been impossible. For instance, I was always the majority shareholder with over 80% of the control of the company, as it was “my idea”, but never received a dime for this shares. As you can imagine the compromise of most of the other partners was proportional to their share levels, especially those that never received money for their work. I understand this today and it was a huge mistake on my part.

Another important error we made is that the team was young and unexperienced. It is possible that if we had someone in the team with more experience and background, the end result might have been different.

Our business plan required us to make a long in-house software development for over a year, time were we were not going to sell anything, just have expenses. This is what happened and we place all our faith, money and time to just one product. At the end, the software had many problems and all that time and money went straight to the trash. Today I see that a different approach, like using a Minimum Viable Product strategy or product diversification might had worked out better.

Although this story has many more details, that someday I will gladly share, this is the main story. I made too many mistakes that as leader I shouldn’t have. My inexperience, summed with other elements made the company a failure and lead to its closure.

Afterwards I had to find a job, something I didn’t wanted, but at the end it allowed me to take once again my entrepreneur road. Two years after the company went broke I quit my job and restarted my phase as an entrepreneur. I’ve been at this second tenure over 5 years and a half, which has been easier and more productive than the first run. I’m happy and I’m sure the future has great things for me. I’m conscious that much of what I’ve accomplished has been the result of what I learned of this first failure. I don’t wish anyone to go broke, however the hard hits of life are the ones who leave the greatest lessons and knowledge.

Image taken from Flickr.com