I had a start up company which as of today is being shutdown because of some serious issues which i will be writing here. This post is to give advice to other people.( esp. Entrepreneurs).
Here’s my case. I started with $110k ( #25m, which is very enough for a start up) to build my dream. I employed a CEO to manage the company and he contracted the Job to a programmer whom worked in the previous company where the CEO was from. The Programmer still had his day JOB where he earns 160k per month ( from the company: Emerging Platforms in Abuja. Garki 2) . The CEO overhyped the contract price because he and the Programmer had a secret deal that they will split the Cash. 1 month into development i wanted to terminated the contract due to his was SLOW and the CEO insisted that he should stay because of their secret deal as of then. As this continued the Programmer built only 35% of the app and has received 80% payment. Instead of launching the app in 3 months (may- august 2014) as proposed i ended up launching in January 2015 with only 35% of the system. I have survived on this for the past 8 months of this year and still the programmer hasn’t delivered the full app.
The CEO mismanaged the trading capital we started with in January till date and the company is folding as of now.
After 1 yr 3months of this I have decided to shutdown so i can have Peace. In the process of shutting down, a lot has come to light.
The secrets deals between the CEO and the Programmer.
**The Programmer told me that what he did is what ever freelancer will do when he thinks he’s client doesn’t have money even after acknowledging that he has received 80% of his payment and also acknowledging that he has only built 35% of my system/dream **
He also told me that he is building his own app that has some of the features of my app and needs my consent ( bridge of trust, as he called it). and that he has also saved 3 million naira for schooling in Canada Toronto next year.
My capital is gone. My app is destroyed. My dreams crushed. No Profit to record till date. Yet he wants to rise and become our new Zuckerberg! lol
I am sad I lost my capital for that business but I felt I should share this experience of mine with everyone.
Also to give that Programmer a big round of applauses for his deed ( he still think he hasn’t done wrong to another). I have forgiven and forgotten ( i just found out all this within a week from today). Pay back is not from me I leave it to God. Even if you make the whole billions in the word (Mr. J, i know you are on radar, so you might see this). my question is, will God grant you life to enjoy it or You might spend the whole money on hospital bills either for your self or your family. We get what we deserve.
Please everyone reading should please add their own advice so we might all learn from others .
I might be missing something but this doesn’t strike me as a specific tech problem but more of a mismanagement issue.
Not clear from above what exactly is your role apart from the ‘money man’? I assume you’re a man…I might be wrong. In any case, why didn’t you play more of a role in running of the firm? You said the programmer had a 9 to 5, what’s your 9 to 5? How did you decide that your ‘dream’ was better run by someone else?
First of all, sorry about your ordeal and experience with the said CEO/programmer duo. While I don’t deny there are a number of freelancers that typically don’t respect themselves in the very least, they are not indicative of what you’ll get with everyone else, not to talk of the technology industry at large.
I would like to know exactly what this CEO’s role was besides hiring a programmer and making money off him. Was he not engaged enough to be paid money to justify his employment? Something tells me your CEO did not share your vision with you at all and was only there for the opportunity to have a title, swindle you out of enough money, and bail. That there is a mistake on your part for not carrying out due diligence, and has nothing to do with the industry.
Never hire a freelancer that does not believe in the product they are being paid for. It never ends well. Trust me. I know this too well from over 10 years of experience that I myself actively avoid taking work I don’t see sense in or don’t think is necessary. A contact I made roughly 4 years ago called me earlier this year to say he wanted an e-commerce platform. He imports fragrances and other beauty products and is wealthy enough to be willing to splatter good enough money on what could only be a dressed up open source cart. After conversing with him and realizing this fact, along with the lack of any form of growth strategy whatsoever, I set him up on Konga SHQ there and then. He’s doing just great with the direction we went and has no complaints. I hate to imagine what would have happened otherwise. I could go on with similar anecdotes.
I hope you learn from this anyway and take better precaution in the future although I’m surprised as from your tale it appears this was doomed from the very beginning. Hindsight is 20/20, they say, but the series of sustained wrong decisions here take the cake.
I’m still struggling to believe that this isn’t fiction.
How come you had/ran a company with no product for over a year, spending $110,000? If you had no product, then you had no customers, meaning you had no business? What did you need a CEO for without a business? Or is there something you ain’t telling us? Did you even do any research before spending that kind of money?
An advice from Marc Anderssen for startups on hiring CEOs: Don’t. If you or none of your cofounders can be the CEO, then shut down the company.
Yes, you are right my role was the Money Man. I have businesses i run on my 9 to 5 that’s how i made the 25m which i spent on the project. I am a young man below 24yrs . I tried my possible best at that point to be involved by giving directions, support and funds needed to achieve the dream because i was busy serving our country, Nigeria (NYSC). So, as of when I became fully active the danger had been done. Well, I was wrong to have initially hired anyone. We Don’t Know it All. We must experience some to learn.
I shared this so other can learn from it. “why experience it when you can read and learn from it”
You initially came in here willing to put all of the blame on other people, which doesn’t seem right, you made some mistakes too. Echoing the above, how did you manage to spend 25m in just over a year?? Especially as the product isn’t half finished? What did the money buy then?
I’m sorry for your misfortune, but you really ought to learn to manage money better, brush up more on entrepreneurship and finance. Technology industry aside, sounds you could have easily had this issue in any other industry. Doesn’t sound like the CEO you hired was someone you could trust which was another problem. They obviously took advantage of your lack of knowledge about tech (I’m just assuming here). If you aren’t well-versed in the area you’re trying to build a business in, people are going to rip you off. That’s why people always say that even if you can’t code you should familiarize yourself with it, the process and the product.
From May -Dec 2014. He just managed the app development by the programmer. From 2015 we kicked of with what we had and he hired more staff and he made lots of call. He claimed he had the same vision as I did I guess not. As for his payment even during development he earned a stipend and our deal was after 3 months of operation we will discuss his salary.
Thanks for Your Advice. I have learnt and hope not to repeat such ever again. Hindsight is 20/20
Lol, I wish it was. We have/had a product. It was only 40% complete and we launched.
An advice from Marc Anderssen for startups on hiring CEOs: Don’t. If you or none of your cofounders can be the CEO, then shut down the company. - Thanks for this.
I see what you mean by ‘sharing your experience’ only the title was ‘problems with and in the African technology industry’, it’s easy to assume your experience touched on the ecosystem at large. So African technology problems such as;
Herd mentality - everyone loves to solve the same thing eg Jumia/Konga, Nairaland/LIB clones is in fashion
Closed environment - eg lack of public APIs of Jumia, Konga etc
Single founders - Despite overriding evidence that 2+ founders perform better…we always prefer to fly solo
Lack of funds - absence of angel investors, VC etc
Poor digital infrastructure - Data, ISP etc
Of course any list of ‘problems’ is subjective but not having the time to manage a project and finding out, that people will take advantage, is not a ‘problem’ for the tech industry.
My intention was made clear in “Line 2” of the post i.e to advice (sharing my experience so other can learn form it). Yes, I boldly accept I made mistakes too by not being fully active from inception nor for not having the patience to wait until I was done serving Nigeria.
Spending that kind of money is quite easy when you paid
Salary 4m
3m for bus ads.
2m for the best UI/UX.
development fee 2.8m
servers, load balancer and all $7.5k
Telecoms & Hardware 10m
etc.
I spent a lot because i wanted the best.
All this was done and the product was built up to like 75% (only shown during presentations but never delivered the full package, only the 35% we launched with ). And If i had resulted to force to get the codes, he will shut the program down/ interrupt the service provided. He has made threats like that before.
About “Nigerian christian being gracious and low keying cursing your generation” referring to your twitter handle post. Its an advice for (Mr.J) not a prayer. Its for him to stop such act and discontinue from the developing my idea for himself . I know we all get what we deserve. I too have received punishment for doing wrong in the past. So its a Normal saying.
Woah dude. For a product that launched with 35% of its functionality, 1 developer, and fringe users, I have to say you spent really generously on servers.
@MistaMajani this wasn’t even half necessary mate. Not even close!
@somto when you’re done with your service. Make very sure you get a job.
Others have learned more valuable lessons with less waste.
Please for the love of God. Don’t try at your dream again just yet.
Get a job. Stay there and grow up. Going by all you’ve said It’ll takes many years for you to fully learn the weight of it all.
And don’t repeat this story somewhere else. People won’t take pity on you, am hardly taking any on you. You just threw away someone’s future in a half-assed attempt at everything that’s wrong with founding startups.
Don’t go on forums looking to out Mr J, and please try to get very upset, get very upset with yourself. All I see you do is take pity on yourself and call out others. Bro, get very upset at yourself it might help you straighten up for the interim. What a mess!
@PapaOlabode I guess I made a mistake with the Title (sorry about that). From your reply I just learn another - Single founders - Despite overriding evidence that 2+ founders perform better…we always prefer to fly solo - I was going to create another startup just my self and then until after a while I will hire anyone. But from this, I think I will have to look for a co founder. Lack of funds - absence of angel investors, VC etc - I want to make an impact in the technology space of Africa, so I am setting up a VC company that will support people in tech. I hope I find good companies to invest in.
@87_chuks I was done service this February. I turn down the job i got afterward, it was good paying (NNPC,280K/mth). I have been actively involved in my family businesses since I was 16 and at times i trade on stock, and I make more than * 7 of the proposed Job in a month from them. This was my 1st startup by myself, though lots of money was wasted but I learnt a lot. I still want to do business. I don’t need pity that’s for the weak. I need advice so I don’t mess up again. I will still chase my dreams for the love of humanity. Not All of us make it in the 1st attempt but we have to keep trying. I need advice from people in the tech industry that why I posted this here not to cry baby at Mr.J and of course I am upset at my self that I was gullible but I am not dead am I. They say what doesn’t kill you only makes you stronger.
