As a refresher, what is your business?
Vaiad is an automated self-serve platform that websites can use to sell ad space directly to advertisers. Currently, direct ad sales require a lot of back and forth by email or phone, which takes days or even weeks for each deal. Vaiad instead provides a common interface, integrated on the back-end with publishers’ ad servers, that can execute the entire process instantaneously and with better results.
What was your progress at the time of the last Harbus interview?
Omar was the sole founder, had interviewed a few customers so far, and had started the prototype development process.
What significant milestones have you since hit?
- Douglas joined as co-founder in May 2011.
- On June 6, we incorporated as a Delaware C Corp.
- In mid July, we hired a developer out of the Ukraine via oDesk. After 1 month of promising results, we hired him full time through end of November.
- In the week of September 19, we finally launched the minimum viable product! We will try it out with two alpha customers with less than 1M unique visitors/month for starters to test in a live environment. We have received oral commitment from two customers with > 1M visitors/month to try the beta in October.
Have you tweaked or changed your product/business model since then? If so, what prompted the change?
We’re now emphasizing the human services component of our business. Most of the customers we’ve interviewed emphasize that while they value automation, the human touch in the direct sales process is still important to getting the deal done, especially for smaller or midsize advertisers or websites who need some assistance to get them through the process. Also, many ad tech companies consciously shun business opportunities that are human capital intensive for fear of not being scalable enough and so are weak from a customer service perspective. This creates an opening for disrupting this space from this angle.
What is your next step in the venture process?
The key next step is implementing the minimum viable product with 2-3 websites and getting advertisers who visit these websites to convert into actual campaigns through our tool, a key validation milestone. If that happens, I’ll feel optimistic about our chances for growing the business and raising funds by early 2012.
Has your opinion changed at all about starting a venture?
This summer was a rude awakening for me in terms of the challenges of creating a product, even a minimum viable product. This process takes a long time. I thought we’d be done with the MVP by end of July. Yet development has taken over 2 months even with a dedicated full time developer working on the product. It’s a classic rookie mistake, often made by business or non-technical founders. Nevertheless, these are the types of lessons you can only really learn in practice, and I’m very grateful that I chose to work on my startup this summer and learn these lessons first hand.
What have been the biggest challenges, and what lessons have you learned so far in the process?
The biggest challenge is the development of the product without having a technical background yourself. Nevertheless, we’ve executed well on this front despite the lack of a technical co-founder by improving our product spec’ing abilities and clearly communicating what the product must do on both the front and back ends. In fact, a key lesson I’ve learned is that business founder can and should try to at least reach the development of the first MVP milestone, along with some validation from customers testing it, before actively recruiting a technical co-founder. That way, the business founder can “earn” a better technical co-founder by proving his/her ability to build a business rather than just talk about a business idea. Quality of any partner shouldn’t be compromised and it’s better to try someone for at least a month before signing them on as partners in the venture.
How do you balance life at HBS with starting your own venture?
I’m working about 20-25 hours / week on my startup. I’m doing an Independent Project directly related to my startup so it’s an active part of my curriculum. I try to follow a standard schedule in terms of when I work on the startup so it doesn’t blur with my personal life and seem like I’m always working on the startup. I don’t work on my startup (or academic work for that matter) Friday evenings and all of Saturday (except in case of customer/site emergencies). Those are sacred “free days” that allow me to rejuvenate
How can HBS encourage more entrepreneurship?
More classes with graduate students from other parts of the university to work on business / product ideas. A friend of mine from Stanford told me about a class there which actively combined students from science/tech, business, legal, etc backgrounds to work on a project / product / business idea of their choosing. In essence, they are combining the various elements you need to successfully start a business; each element on its own is insufficient.
Omar Restom is an MBA student at Harvard Business School, an HBS Entrepreneurship Fellow, and winner of the HBS Minimum Viable Product Contest (one of 9 teams out of 88). Prior to HBS, Omar was the Online Marketing Manager at JustAnswer, where he played an instrumental role in growing the company 6x and making it one of the largest Google advertisers by spend. His work on direct ad sales at JustAnswer shed key insights into the shortcomings of this process and how it could be vastly improved.
Douglas Melchior earned his MBA at Harvard Business School, where he was president of the TechMedia Club. He has experience in product management and marketing at PhotoRocket, a photo-sharing company based in Seattle, and marketing experience at Goby, an activity-based search engine in Boston. Over the past 12 years, he has designed and created numerous websites.